interestrateripoff

Gordon Brown: "i Called For Global Financial Reform Ten Years Ago"

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[url="http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article5590281.ece?Submitted=true"]http://business.timesonline.co.uk/tol/busi...?Submitted=true[/url]

[quote][b]Gordon Brown claimed today that he had been warning for ten years that the international financial markets needed to be more strongly regulated.[/b]

The Prime Minister said that it was a decade ago in Harvard that he first called for an international early warning system to alert countries to developing crises in any part of the world, because the huge global growth and reach of financial systems meant that all markets, all economies and all banks were now interdependent.

[b]Mr Brown said that he had recognised the need for a stronger regulatory framework ever since the crisis in Asian markets in the 1990s.[/b]

The current global crisis, which began when the US housing bubble burst but whose effects were now being felt worldwide, he said, proved the need for world leaders to meet to put in place a new international system of regulation akin to the Bretton Woods conference after the second world war.

The subject would be top of the agenda at the G20 summit in London in April, he promised.

"As I said in Harvard ten years ago, we need an early warning system so that international financial flows are properly monitored," Mr Brown said in a speech this morning.

"We must create a framework for the international governance that we currently lack. We must consider at a global level the regulatory deficit. For a decade I have said that the current patchwork arrangement is inadequate."

The Prime Minister's claim to have been warning of the risks of failing to regulate global markets is likely to provoke derision from opposition parties, who accuse him of failing, as Chancellor from 1997 to 2007, to do anything to halt the worst period of unbridled risk-taking by financial institutions.

Britain's heavy dependence on the financial markets of the City of London as the motor for its economy means that the country will find it harder to recover than other more diverse economies, Mr Brown's critics say.
[b]
Mr Brown defended his record, claiming that Britain had "low public debt, low inflation and low interest rates", and that corporate debt was far lower than in previous times of financial crisis. He did not allude to Britain's record levels of personal debt.[/b]

"We are in a stronger position because we have taken action early to recapitalise our banks and aid recovery," said Mr Brown.

"In the last 10 years since the Asian problem we in Britain have been advocating greater international supervision and reforms in transparency and exposure.

"Every financial system will have to look at how it organises its affairs in future, but every financial system will also have to find a way of working with international partners. Because if something that happens in the US can affect every country in Europe, there needs to be a way by which regulators and supervisers can be more closely linked with one another."

Mr Brown listed the international reforms he said were needed, including:

* ensuring national financial regulators stay in close touch with their counterparts in other countries

* setting standards for all financial institutions around the world on transparency and corporate governance

* reforming bankers' pay and rewards to encourage responsible, long-term risk-taking rather than quick profit.

The rules would have to cover the new and complex, highly leveraged financial instruments that had come into being to spread risk, but which were too little understood and had now exposed investors everywhere to huge financial problems, Mr Brown said. He advocated "a simple rule - if you don't understand the risk, don't take it".

He said that international co-operation was needed to handle the threat of "de-leveraging" - when such investments are given a new, and much lower value, causing violent plunges in the balance sheets of banks, businesses and pension funds that have bought into them, and leaving ordinary people finding that their investments and pensions have dramatically shrunk.

He said that he and Alistair Darling, the Chancellor, would be inviting bank chief executives for talks before the G20 conference on how to handle de-leveraging.

He also warned against "de-globalisation" - a tendency for governments and banks to stop lending outside national borders, which Mr Brown said would only make the credit crunch worse.[/quote]

Once more brilliant journalism here which fails to nail the bar steward to the wall by his gonads.

No mention of the warnings given by the IMF, isn't this a global organisation capable of issuing warnings?

No mention of the questions raised by Vince Cable in 2003 in the houses of parliament that Brown laughed off.

No mention of the likes of Roubini etc.... who've been warning about this for years that Brown ignored.

No mention of the laughable speeches by Brown which applauded his own genius for producing a stable economy.

WTF is a matter with the press, it's like they are all asleep at the wheel or high on crack cocaine. Edited by interestrateripoff

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[url="http://www.telegraph.co.uk/finance/financetopics/recession/4344857/Global-recession-Gordon-Brown-urges-world-to-follow-Britain-and-avoid-financial-protectionism.html"]http://www.telegraph.co.uk/finance/finance...tectionism.html[/url]

[quote]The economic storm lashing Britain will pass, Mr Brown said on Monday, but warned that his efforts to tackle the crisis will be undermined if other countries do not follow his lead.

He denied that last week's UK bank rescue package had been rejected by the markets and said other world leaders would soon be following Britain. He again pointed the blame for the crisis at excessive and unregulated lending overseas.

In a speech at the Foreign Press Association Mr Brown said: “This is an international economic hurricane sweeping the world and lashing our country.

”But we are taking action to calm the storm to bring order to our chaos so Britain can be better placed to benefit as the storm passes – as pass it will.”

The Prime Minister is now pinning his hopes on other countries acting quickly to stem the problems with similar rescue plans as Britain's. He warned if they do not then there is a danger that “financial protectionism” would arise, with dire consequences for growth.

He said: “If what happens to a bank in one country can within minutes have devastating effects for banks on a different continent, then only a truly international response of policy and governance can be effective.”

He added: “We have not yet seen the protectionism in trade with beggar-thy-neighbour policies such as the 1930s and I will work hard to ensure we do not.

”But we also need to work to ensure that we do not experience a new form of financial protectionism, of mercantilism, of retreat into domestic financial markets.”

Leaders of the top 20 industrialised nations – the G20 – will meet in London in April. Mr Brown wants that meeting to focus on a new set of principles to guide the world economy and financial systems.

He said: “At the G20 we should seek to discuss the charter of principles for financial regulation and supervision which all will follow. Under this, we need to bring into the regulatory system non bank institutions and complex new markets and products.

”If financial firms are doing similar things, then the principles by which they are regulated must be the same regardless of their business models and countries of origin.”[/quote]

More bottom kissing.

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Just for the record, can he or anyone else link the speech which he claims to been making for the last 10 years, saying that a stronger international framework is needed?

[quote]As I said in Harvard ten years ago, we need an early warning system so that international financial flows are properly monitored," Mr Brown said in a speech this morning.[/quote]
Harvard speech = ?

[quote]For a decade I have said that the current patchwork arrangement is inadequate.[/quote]
For a decade would imply he has said it more than once.. in which case a few linkies wouldn't be hard to find?

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[url="http://www.guardian.co.uk/politics/2009/jan/26/gordon-brown-economic-policy"]http://www.guardian.co.uk/politics/2009/ja...economic-policy[/url]

[quote]Gordon Brown today called for a "new global order" to deal with the economic crisis as he warned against the protectionist policies of the 1930s.

In a wide-ranging speech on the global economy, the prime minister said that a radical step-up in global cooperation was necessary to prevent the emergence of "financial mercantilism".

"We face a choice. We could allow this crisis to start a retreat from globalisation. As some want, we could close our markets – for capital, financial services, trade and for labour – and therefore reduce the risks of globalisation. But that would reduce global growth, deny us the benefits of global trade and confine millions to global poverty.

"Or we could view the threats and challenges we face today as the difficult birth-pangs of a new global order – and our task now as nothing less than making the transition through a new internationalism to the benefits of an expanding global society – not muddling through as pessimists but making the necessary adjustment to a better future and setting the new rules for this new global order," the prime minister said.

This is the start of a 10-day period when Brown, who talked to Barack Obama, the new US president, on Friday, will meet a number of world leaders to discuss preparations for the G20 meeting in London in April.

The meetings will discuss how Britain can best work internationally on financial reform, economic expansion and the creation of jobs in new sectors such as the environment.

Having held lengthy discussions with European leaders last week, Brown will meet the prime ministers of China, Korea and Japan in the next week. He will also meet the heads the international financial institutions, starting with Robert Zoellick, the president of the World Bank, on Tuesday.

In his speech this morning Brown said: "The ability of banks in Britain to operate as we wish depends not only their management at home but on getting regulation right internationally.

"Our banking systems have been shown to be totally interdependent and interconnected. No financial institution anywhere can insulate itself from the shock that started in the US mortgage market earlier this decade. As banks facing losses retreat to their home markets, we have had a loss of lending capacity in every major market.

"And it is in order to fill this gap, we put forward last week a package of support for the economy."

The prime minister argued that the latest rescue package was designed to reduce the uncertainty that banks faced with losses on their historic loans, alleviate their capital ratios, ensure their funding, and most importantly enable and require them in return for this to increase their lending to businesses and families.

"This is the key to preventing a deeper and longer recession than we need to have," Brown said.

"[b]The fragility of the global financial system must be addressed internationally. If what happens to a bank in one country can – within minutes[/b] – bring potentially devastating effects on banks in a different continent, then only a truly international response – in policy and governance – can be effective. If we all coordinate our response there will be a quicker global and therefore British recovery.

"We have not yet seen the same protectionism in trade with beggar-thy-neighbour policies of the 30s. And I will fight hard to ensure we do not. But we also need to ensure we do not exercise a new form of financial mercantilism of retreat into domestic lending and domestic financial markets."[/quote]

Again no criticism of what he's saying.

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[url="http://www.iie.com/publications/papers/paper.cfm?researchid=244"]http://www.iie.com/publications/papers/pap...?researchid=244[/url]

[quote]Preventing Financial Crises: The Case for Independent IMF Surveillance

by Edward Balls, Chief Economic Adviser to the British Treasury

Remarks at the Institute for International Economics
Washington, DC
March 6, 2003

Introduction

These are particularly uncertain global economic times. And my argument today—as we prepare the IMFC Deputies meeting in London at the end of this month in advance of the Spring IMFC Meeting of Finance Ministers—is that it is now urgent that we move forward in both implementing agreed reforms and shaping the next steps on both crisis prevention and crisis resolution.

The Institute of International Economics and its fellows have played a central role in this debate about reform. At the Federal Reserve and US Treasury, Ted Truman developed and delivered vital reforms; Fred Bergsten, Morris Goldstein, Michael Mussa, and John Williamson, to name just a few of the Institute's distinguished fellows, helped to set that reform agenda and continue to shape the debate.

Let me, on behalf of the UK, pay tribute to the role that the IMF has played over the past six years at the forefront of reforms to the international financial system. Michel Camdessus and Stanley Fischer shaped many of the reforms in the period after the Asian crisis of 1998. And I want, in particular, to pay tribute to the leadership of Horst Kohler, and to recognize the great contribution that IMF First Deputy Managing Director Anne Krueger has made with her work leading the debate on crisis resolution and through her strong and compelling arguments for a Sovereign Debt Restructuring Mechanism (SDRM). We must and will make progress on crisis resolution at the Spring meetings—and I will return to that subject later.

But we must also make progress on crisis prevention. And this is my principal topic today. I want to look again at the lessons we learned from the 1997-98 global crisis and the effectiveness of the reforms we introduced. I will argue that the lessons we learned from the Mexican, Asian, and Russian crises were the right lessons—and that these lessons have been reinforced by recent crises such as in Argentina and Turkey, the recent IMF surveillance review and the first report from the new Independent Evaluation Office.

Our work so far has stressed the fundamental importance of strong, credible, and transparent macroeconomic frameworks to provide the foundation for stability and growth; the need for internationally agreed codes and standards for sound policymaking that can be implemented by all countries; the rewards from greater transparency at the national and international level; and the need for a stronger focus on key vulnerabilities and risks, particularly in the financial sector.

But there is more to do. We must implement fully and deeply the ideas we had back in the late 1990s. But learning the lessons from the past—including the more recent past—-demands that we go further and accept the need for a fundamental strengthening of IMF surveillance—making it more independent, authoritative, transparent, and accountable.

The international community has recognized that further reform of IMF surveillance is necessary. Last September's IMFC communiqué called for "ongoing work to ensure that surveillance in program countries reassesses economic developments and strategy from a fresh perspective." The challenge—as the UK Chancellor of the Exchequer Gordon Brown said last September—is to make the IMF as credible and independent from political influence in its surveillance of economies as an independent central bank should be in the operation of domestic monetary policy.

So today I want to set out how, in implementing this IMFC remit, the world community of nations can implement new reforms to build a new system of international economic governance and surveillance which can strengthen our ability to prevent crises and advance our shared objectives of stability, development, and prosperity.[/quote]

This is from 6 years ago, continues at the link very long article.

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[quote name='rw42' post='1617554' date='Jan 26 2009, 01:45 PM']Just for the record, can he or anyone else link the speech which he claims to been making for the last 10 years, saying that a stronger international framework is needed?


Harvard speech = ?


For a decade would imply he has said it more than once.. in which case a few linkies wouldn't be hard to find?[/quote]

2005
[quote]4. The FCO supports sustainability through our efforts to promote improved environmental governance and democracy, and sustainable natural resource management in priority countries, [b]a stronger international framework for sustainable development[/b] and climate security, and sustainable tourism. We lead for the Government on promoting human rights, democracy and good governance which are critical for sustainable development, and we seek to embed sustainable development principles in all our activities. This includes leading by example by managing our estate and corporate activities sustainably.

31. The outcome from the 2005 UN World Summit called for much stronger, system-wide coherence across the various development-related agencies, funds and programmes of the United Nations. In response, Kofi Annan launched the High Level Panel (HLP) on System Wide Coherence (SWC) to make recommendations on how the United Nations system could work more coherently and effectively in these areas. The Chancellor, Gordon Brown was the UK's representative on the Panel. The Panel's recommendations, launched in November 2005, called for reform to the development, humanitarian assistance and environmental system of the UN, including the UN Environment Programme and UN operations at country level.[/quote]

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[url="http://archive.treasury.gov.uk/press/1998/p209_98.html"]http://archive.treasury.gov.uk/press/1998/p209_98.html[/url]

[quote]HM Treasury News Release
209/98 15 December 1998


REDISCOVERING PUBLIC PURPOSE IN THE GLOBAL ECONOMY


Attached is the text of the lecture that the Chancellor of the
Exchequer, Gordon Brown, will deliver this evening at the
Kennedy School, Harvard University.

Tomorrow the Chancellor will be in Washington where he will
meet:

US Treasury Secretary - Robert Rubin;

Chairman of the Federal Reserve - Alan Greenspan;

Managing Director of the IMF - Michel Camdessus; and, on
Thursday,

President of the World Bank - Jim Wolfensohn.

The Chancellor is visiting the United States at the end of the
UK Presidency of the G7 to press forward the major reforms
needed to strengthen the international financial system.


Media enquiries:
Charles Keseru - 0171 270 5188
Charlie Whelan - 0468 003425 (in the US)




CHANCELLOR OF THE EXCHEQUER'S LECTURE AT THE KENNEDY SCHOOL,
HARVARD UNIVERSITY ON 15TH DECEMBER 1998

"REDISCOVERING PUBLIC PURPOSE IN THE GLOBAL ECONOMY"

INTRODUCTION

THERE CAN BE NO MORE APPROPRIATE COUNTRY TO DISCUSS THE
CHALLENGES FACING THE NEW GLOBAL ECONOMY THAN THE UNITED STATES
OF AMERICA: THE PRE-EMINENT ARCHITECT OF THE POST-WAR GLOBAL
SYSTEM.

THERE CAN BE NO FORUM MORE APPROPRIATE THAN THE KENNEDY SCHOOL,
NAMED AFTER THE PRESIDENT, WHO ON JULY 4th MORE THAN A THIRD OF A
CENTURY AGO, MATCHED THE DECLARATION OF INDEPENDENCE OF 1776 WITH
A NEW DECLARATION OF ECONOMIC INTERDEPENDENCE FOR OUR TIME.

AND THERE CAN BE NO MORE APPROPRIATE INSTITUTION THAN HARVARD
WHERE 50 YEARS AGO, THE MARSHALL PLAN, THE MOST AMBITIOUS
MULTI-NATIONAL EFFORT FOR ECONOMIC RECONSTRUCTION THE WORLD HAS
SEEN, WAS FIRST LAUNCHED.

MORE THAN HALF A CENTURY AGO, LEADERS WHO WERE STILL ENGAGED IN
WAR TOOK THE TIME TO PREPARE FOR PEACE. IN A BREATHTAKING LEAP
INTO A NEW ERA, THE WORLD CREATED NOT JUST NEW INTERNATIONAL
INSTITUTIONS - THE IMF, THE WORLD BANK, THE GATT AS WELL AS THE
UN - AND A WHOLE SET OF NEW RULES FOR A NEW INTERNATIONAL
ECONOMY, BUT GAVE EXPRESSION TO A NEW PUBLIC PURPOSE BASED ON
HIGH IDEALS.

A GENERATION OF LEADERS WHO HAD KNOWN THE GREATEST OF DEPRESSIONS
AND THE GREATEST OF WARS KNEW ALSO THAT JUST AS PEACE COULD NOT
BE PRESERVED IN ISOLATION, PROSPERITY COULD NOT BE MAXIMIZED IN
ISOLATION.

WHAT THEY DID FOR THEIR DAY AND GENERATION WAS SO DRAMATIC THAT
DEAN ACHESON SPOKE OF THAT PERIOD AS AKIN TO BEING PRESENT AT THE
CREATION.[/quote]

Continues at the link, all in caps so it appears a bit shouty.

I think this is what's being referred to.

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Give them a chance.

In the 'on-line world' all the papers, including the Torygraph, are rushing to be first to get a précy of his speech onto the web.

I expect the editorial comment and so-called columnist 'experts' will come later. At least, I hope so!

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[url="http://www.guardian.co.uk/business/2006/jun/22/politics.economicpolicy"]Gordon Brown's Mansion House speech[/url]
[quote]advance with light touch regulation, a competitive tax environment[/quote]
[quote]stability through a predictable and light touch regulatory environment[/quote]
[quote]And just as two years ago we promoted the action plan for liberalising financial services across Europe, I can tell you that the Treasury is now working with Charles McCreevy and with you to ensure that the forthcoming European financial services white paper signals a new wave of liberalisation.[/quote]
[quote]To meet the challenge of global markets we created a single unified FSA.[/quote]
[quote]In 2003, just at the time of a previous Mansion House speech, the Worldcom accounting scandal broke. And I will be honest with you, many who advised me including not a few newspapers, favoured a regulatory crackdown.

I believe that we were right not to go down that road which in the United States led to Sarbannes-Oxley, and we were right to build upon our light touch system through the leadership of Sir Callum McCarthy - fair, proportionate, predictable and increasingly risk based. I know Sir Callum is committed to reducing regulatory administrative burdens and the National Audit Office will now look at the efficiency and value for money of our system.[/quote]

[quote]Let me say I see no case for a European single regulator and will continue to reject such a proposal, just as we will resist the new and unnecessary proposals to harmonisation corporate taxation in Europe.[/quote] Edited by Concrete Jungle

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[url="http://www.forbes.com/feeds/afx/2006/10/18/afx3100683.html"]http://www.forbes.com/feeds/afx/2006/10/18/afx3100683.html[/url]

UK's Brown meets with City businessmen, aims to cut back on regulation UPDATE
10.18.2006, 11:08 AM

LONDON (AFX) - Chancellor of the Exchequer, Gordon Brown, and the Economic Secretary, Ed Balls, today met with top city businessmen aiming to enhance London's competitiveness mainly by cutting back on regulation, the Treasury confirmed.

The government has set out proposals to reduce the burden of regulation and will push for a more de-regulatory stance in the European Union under the German presidency.

The government will examine, along with the Financial Services Authority, whether the regulations may be lightened for insurance services with low consumer detriment or systemic risk.

:blink:


[quote]='Concrete Jungle' date='Jan 26 2009, 01:58 PM' post='1617599']
Gordon Brown's Mansion House speech
stability through a predictable and light touch regulatory environmentTo meet the challenge of global markets we created a single unified FSA.Let me say I see no case for a European single regulator and will continue to reject such a proposal, just as we will resist the new and unnecessary proposals to harmonisation corporate taxation in Europe.[/quote]



He just keeps on openly lying, and it works. Edited by Mr. Parry

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[quote name='rw42' post='1617554' date='Jan 26 2009, 01:45 PM']Just for the record, can he or anyone else link the speech which he claims to been making for the last 10 years, saying that a stronger international framework is needed?


Harvard speech = ?


For a decade would imply he has said it more than once.. in which case a few linkies wouldn't be hard to find?[/quote]

2001, washington speech on globalisation
[url="http://www.hm-treasury.gov.uk/press_146_01.htm"]http://www.hm-treasury.gov.uk/press_146_01.htm[/url]
[quote]Our capacity to prevent crises is enhanced not just by the operation of codes and standards - and the offer of proportionate help to countries who adopt them - but also by rigorous surveillance, effective international early warning procedures and a more consistent engagement by the private sector.

The new architecture must therefore involve an enhanced role and authority for the IMF, monitoring and reporting on the operation of codes and standards, and my proposal is that we make the IMF's surveillance and monitoring functions independent of the inter-governmental decisions about financial support for crisis resolution.

Alongside greater independence for the IMF, the capacity to prevent crises would be improved by expanding the work of the financial stability forum - which brings together the combined expertise of the IMF and key regulatory authorities - as an international early warning system to tackle national financial sector problems which have international repercussions.[/quote]

In the same speech GB quoted George Marshalls 'Harvard speech'


[quote]This is what George Marshall meant when, in his great Harvard speech, he articulated his great, unifying vision for a global fight, not against one country or one ideology, but against "hunger, poverty, desperation and chaos".[/quote]

The speech was outward looking and aimed at the poor countries of the world... Edited by moosetea

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"As I said in Harvard ten years ago, we need an early warning system so that international financial flows are properly monitored," Mr Brown said in a speech this morning.

"We must create a framework for the international governance that we currently lack. We must consider at a global level the regulatory deficit. For a decade I have said that the current patchwork arrangement is inadequate."
+++++++++++++=

Most people in the UK would just have been content if regulation in the UK had been satisfactory.

The UK is where he had the power and authority to improve "regulatory deficit" if he thought there were problems but no instead he started featherweight regulation.

If he had solved the UK regulatory deficit then when all the global problems emerged he could have said "Look! We in the UK have improved our regulatory deficit why didn't you around the world do the same and you wouldn't all have been in the trouble you are in now".

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Thanks interestrateripoff.

[quote]The challenge—as the UK Chancellor of the Exchequer Gordon Brown said last September—is to make the [b]IMF as credible and independent from political influence[/b] in its surveillance of economies as an independent central bank should be in the operation of domestic monetary policy.[/quote]
Will look up the various warnings the IMF made on UK debt levels and GB's responses - surely if he wants the IMF to be credible and free from political influence then he should take their warnings seriously?

[quote]First, on its comprehensiveness and focus, a common feature of all the crises since late the 1990s is that they started from [b]weaknesses in their domestic economic policy framework[/b] in the fiscal or financial systems
...........
In each country—Thailand, Korea, Indonesia, Malaysia, Brazil, and Russia—large and rapid capital outflows exposed inappropriate macro-frameworks and fragile banking sectors, with [b]massive costs for budgets and economies and ultimately their people.[/b][/quote]
QFT.

Does anyone have a link to the 1998 harvard speech? Quick googling at work isn't finding it!

[edit] thanks for harvard speech - big blocks of text look work related so reading through :) Edited by rw42

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[quote name='rw42' post='1617629' date='Jan 26 2009, 02:12 PM']Does anyone have a link to the 1998 harvard speech? Quick googling at work isn't finding it![/quote]

[url="http://archive.treasury.gov.uk/press/1998/p209_98.html"]http://archive.treasury.gov.uk/press/1998/p209_98.html[/url]

As I said above I think this is it.

Scrolling down too fast? :P

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[quote name='billybong' post='1617619' date='Jan 26 2009, 02:07 PM']Most people in the UK would just have been content if regulation in the UK had been satisfactory.

The UK is where he had the power and authority to improve "regulatory deficit" if he thought there were problems but no instead he started featherweight regulation.

If he had solved the UK regulatory deficit then when all the global problems emerged he could have said "Look! We in the UK have improved our regulatory deficit why didn't you around the world do the same and you wouldn't all have been in the trouble you are in now".[/quote]
Exactly Billybong. In my opinion, by making his current claims, he's actually making himself look worse, as it moves his position from one of "Whoops, I ******ed up!" to "Saw this coming, didn't do anything about it though, hey-ho".

"Controlled flight into terrain in conditions of perfect visibility", as the CAA might say.

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[url="http://news.bbc.co.uk/1/hi/business/2814809.stm"]http://news.bbc.co.uk/1/hi/business/2814809.stm[/url]

[quote]Monday, 3 March, 2003, 16:10 GMT

The International Monetary Fund has warned the UK it could be facing a dangerous house price bubble.

The IMF said the UK's economic prospects were generally good.

But it singled out spiralling property prices - and the possibility of a deflationary crash - as an "appreciable" risk.

The IMF's assessment came as the UK's biggest mortgage lender, Halifax, reported a 23% increase in property prices over the past 12 months.

Interest rates

The Halifax figures, released earlier on Monday, fly in the face of recent research suggesting the housing market may be cooling.

Halifax said demand remained strong and prices went up by 1.7% in February.

The Bank of England was careful to avoid fuelling a property boom by holding off from cutting interest rates for more than a year.

But it caved in last month and cut rates by a quarter of one percentage point, after pressure from industry and worries about the world economy.

Ready to respond?

Most IMF directors endorsed the Bank of England's decision to lower interest rates in February.

But the international lender said monetary policy must now balance supporting domestic demand against the risk of a housing bubble.

"It was agreed that, going forward, the authorities should stand ready to respond swiftly to the changing balance of risks," the IMF said.

Among those risks are that domestic demand is being buoyed by increasingly high levels of household debt, fueled by soaring house prices and low interest rates.

Growth forecast

"Directors therefore called for heightened vigilance to these risks by the authorities, especially regarding the possible existence of a housing price bubble with its potential deflationary consequences," the IMF said in a statement.

In its annual assessment of the UK economy, the IMF predicted growth of 2.2% this year, compared to Chancellor Gordon Brown's revised forecast of 2.5%.

And it said inflation would reach 2.6%, from its current level of 2.2%, and unemployment would edge slightly higher.

"Directors noted the prospects for continued economic recovery, but they saw appreciable risks to this outlook stemming from both external and domestic uncertainties," the IMF report said.

Interest rates

Earlier, Halifax chief economist Martin Ellis said the UK housing market "remains strong".

But, he added: "There is increasingly a north/south divide with London and the South East becoming more a buyer's market, while the North remains very much a seller's market."

The company said low interest rates, low unemployment and the "affordability" of property, were continuing to drive prices.

New house building - and the number of second-hand of properties coming on to the market - remained at an historically low level, it said, adding further to pressure on prices.[/quote]

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[url="http://www.telegraph.co.uk/finance/2807195/IMF-warns-UK-over-housing-inflation.html"]http://www.telegraph.co.uk/finance/2807195...-inflation.html[/url]

[quote]By Edmund Conway, in Washington DC
Last Updated: 8:22PM BST 13 Apr 2007

The International Monetary Fund has backed expectations that the Bank of England will raise interest rates again, warning that higher borrowing costs may be needed to bring the sizzling housing market back under control.

In its closely-watched World Economic Outlook, the Fund warned that rising inflation and unexpectedly strong house price inflation were key risks facing the UK. It also urged Gordon Brown to make further cuts to spending in an effort to bring the public finances back under control.

The warnings came as the Fund said the overall world economy is motoring towards its best stretch since the 1960s, as the developing powerhouses of the East would help make up for a sudden dive by the US.

However, news that the IMF thinks another increase in rates from their current level of 5.25pc will come as a disappointment for households after the Bank left borrowing costs on hold earlier this month.

The Fund raised its economic growth forecast for this year and the next to 2.9pc and 2.7pc respectively, bringing it almost in line with the Treasury's latest projections at the Budget.

It said: "Domestic demand may turn out stronger than forecast despite recent monetary tightening, given the acceleration in house prices over the past year."

"Buoyant demand and the ongoing pass-through of higher global energy prices to domestic utilities prices has pushed inflation to its highest level in five years.

The combination of higher-than-targeted inflation and diminishing economic slack has prompted rate increases by the Bank of England, and inflation is expected to come down to the target by year-end. However, some further tightening may still be needed, particularly if wage pressures emerge."

In comments which are likely to irritate the Chancellor, who flies out to Washington later this week for what is likely to be his final IMF and World Bank meeting, it said: "The present expansion has provided a context for some progress towards needed fiscal consolidation, but concerns remain whether enough is being done. Tight spending control will be needed to halt the rise in public debt."

The tumbling US housing market forced the Fund to slash its growth forecast for the world's largest economy by 0.7pc to 2.2pc.[/quote]

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[url="http://www.independent.co.uk/news/business/news/imf-warns-over-uk-property-crash-415925.html"]http://www.independent.co.uk/news/business...ash-415925.html[/url]

[quote]By Philip Thornton, Economics Correspondent in Singapore
Thursday, 14 September 2006

A sharp rise in interest rates could trigger a slump in house prices, which are overvalued by "any conventional measure", the International Monetary Fund warned yesterday.

The world's chief financial watchdog warned that soaring prices posed one of the biggest risks to the UK economy.

"House prices in Spain, Ireland and the United Kingdom still look elevated, and could come under pressure in a rising interest rate environment," it said.

The fund's warning came as the Royal Institution of Chartered Surveyors revealed that house prices in the UK are now growing at the fastest pace since May 2004 as house prices accelerated for the fifth month running in August. The balance of surveyors reporting price increases in the past three months climbed to 30 per cent in August from 24 per cent in July.

The IMF also said the chances of another rate rise were "delicately balanced" and urged Gordon Brown to use next year's three-year spending review to cut expenditure to prevent a crisis in the public finances.

However, in a boost for the Chancellor, the fund raised its estimates for growth in the UK economy this year and next, putting it closer to the Treasury's upbeat forecasts for 2006 and 2007.

In its keynote World Economic Outlook, the IMF warned that a fall in house prices - which would leave households poorer - was a potential danger for many rich countries as it would lead to consumers tightening their budgets.

"A key risk on the demand side is that continued cooling of advanced economies' housing markets will weaken household balance sheets and undercut aggregate demand," it said. "At this point, concerns centre on the US, although other markets, such as those in Ireland, Spain and the United Kingdom, also still seem overvalued by most conventional measures."

This marks a harsher warning than its last forecasts in April when it said house prices had come closer to economic "fundamentals" - factors such as demand, supply and wages.

It also follows a raft of figures showing that house prices posted strong gains over the summer although the UK mortgage industry believes that the market will slow rather than embark on a renewed boom.[/quote]

This took a few minutes on google to find, obviously too hard for our journalists to pay attention to what they are printing.

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He said, from one of the earlier links.

"AND BY 1997, AN INCREASINGLY TURBULENT AND INADEQUATELY
SUPERVISED INTERNATIONAL FINANCIAL SYSTEM THREATENED TO CREATE
BOOM AND BUST ON A GLOBAL SCALE."
---------------
So it's not as if he didn't already know what the consequences OF INADEQUATE SUPERVISION would be for the UK.

BOOM AND BUST ON A GLOBAL SCALE!!

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[url="http://findarticles.com/p/articles/mi_qn4158/is_/ai_n12810120"]http://findarticles.com/p/articles/mi_qn41...s_/ai_n12810120[/url]

[quote]Independent, The (London), Sep 24, 2004 by JEREMY WARNER

THE INTERNATIONAL Monetary Fund is worrying about the UK housing market again. It's been doing this for an awfully long time now, yet so far none of its doom laden warnings have come to pass. The UK economy has continued to prosper and the housing market with it.

Yet if you predict catastrophe for long enough, the law of averages alone suggests that one day you will be right. The IMF's latest "World Economic Outlook" is nothing if not consistent. The UK housing market is the most overvalued in the world, it finds, posing a severe challenge to the Bank of England in seeking to contain inflationary pressures while at the same time minimising the risks of a house price bust.

With now unambiguous signs of a pronounced slowdown in the housing market, and even the Bank of England's Monetary Policy Committee expressing concern that it might be overdoing it with the interest rate therapy, has the IMF's day finally come? If consumption and growth have been supported, if only in part, by strongly rising house prices, what happens if they begin to fall? Common sense would tell you the reverse. Indeed, it is to guard against the demand shock of a housing market crash that the Bank of England has been gradually raising interest rates. On the stitch in time saves nine principle, the Bank has been trying gently to cool the housing market without provoking an outright collapse.

The IMF thinks this the right approach, yet it can't decide whether it will do the trick. The upswing in house prices has been a mainly global phenomenon, so it follows that any downturn would also be synchronised, with corresponding implications for the global economy. Since Britain has had a disproportionately large upswing, it would presumably have an equally disproportionate downturn.

Gordon Brown and the Treasury have understandably always been dismissive of this analysis. So far they've been more right than the IMF. Support for their view comes from two papers in today's Bank of England "Quarterly Bulletin". On the face of it, the economy looks very similar at present to the way it was in the late 1980s - with rapidly rising house prices and levels of household credit. Yet it in other respects it is very different. Nominal interest rates are low and likely to remain so. Unemployment too is low and unlikely to rise by much. Household balance sheets are in general in much better shape than they were then, and are therefore better placed to cope with a fall in house prices.

The second paper finds that there isn't as big a link between high levels of equity withdrawal and booming consumption as generally thought. In fact only about a quarter of equity withdrawal is spent immediately on consumption, and that mainly on home improvements. Britain is undoubtedly entering more difficult economic waters, but there is no reason yet to issue even a storm force, let along a hurricane warning.[/quote]

More at the link.

[url="http://www.marketoracle.co.uk/Article48.html"]http://www.marketoracle.co.uk/Article48.html[/url]

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It sounds like he's pulled a Dick Cheney.

In 1991 Dick Cheney was flat against invading and taking over Iraq- outlining the possible tribal conflicts between the Shias and the Sunnis as well as other issues that would make it an impossible task.

Then he left the government and went to work for Halliburton.

Fast-forward 10 years later he's back in government with Bush - we need to invade Iraq.

If Flash Gordo is telling the truth, then he's been bought out and is culpable for wilful neglect. Could the fact the Tony Bliar walked out of government and into a bunch of highly paid, part-time director roles (in name only) with large corporate institutions including one JP Morgan Chase bank have anything to do with it?

Did Gordo set out to save the world, but was then seduced by Lex Luthor who opened his eyes to the world of private initiatives and lucrative positions for someone who leaves government later (after aquiring a large list of worldwide government contacts)?

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[url="http://www.imf.org/external/ns/search.aspx?NewQuery=UK+house+prices&submit.x=0&submit.y=0&col="]IMF Search for House Prices and UK[/url]

[quote]IMF Survey: House Prices Compounding Crisis
October 08, 2008
Housing prices have begun falling this year in several advanced economies. This decline is amplifying the effects of the current financial turmoil.
[url="http://www.imf.org/external/pubs/ft/survey/so/2008/NUM100808A.htm"]http://www.imf.org/external/pubs/ft/survey.../NUM100808A.htm[/url] - 14k - HTML

United Kingdom -- 2003 Article IV Consultation, Concluding ...
December 18, 2003
Describes the preliminary findings of IMF staff at the conclusion of certain missions (official staff visits, in most cases to member countries). Missions are undertaken as part of regular (usually annual) consultations under Article IV of the IMF's Articles of Agreement, in the context of a request to use I...
[url="http://www.imf.org/external/np/ms/2003/121803.htm"]http://www.imf.org/external/np/ms/2003/121803.htm[/url] - 26k - HTML

United Kingdom -- 2004 Article IV Consultation, Concluding ...
December 21, 2004
Describes the preliminary findings of IMF staff at the conclusion of certain missions (official staff visits, in most cases to member countries). Missions are undertaken as part of regular (usually annual) consultations under Article IV of the IMF's Articles of Agreement, in the context of a request to use I...
[url="http://www.imf.org/external/np/ms/2004/122104.htm"]http://www.imf.org/external/np/ms/2004/122104.htm[/url] - 25k - HTML

Transcript of a Press Conference Call on the World Economic ...
September 22, 2004
... Spain, and the United States—the United Kingdom, I should ... Just to be clear, you're expecting house prices to continue to ... are out of whack in the UK in housing ...
[url="http://www.imf.org/external/np/tr/2004/tr040922.htm"]http://www.imf.org/external/np/tr/2004/tr040922.htm[/url] - 31k - HTML

Interest Rate Elasticity of Residential Housing Prices; Plamen Iossifov, Martin Cihák, and Amar Shanghavi; IMF Working Paper 08/247; October 1, 2008
October 01, 2008
... New Zealand, Norway, Portugal, Spain, Sweden, Switzerland, United Kingdom, and the United ... in Appendix II and the residential property price database maintained ...
[url="http://www.imf.org/external/pubs/ft/wp/2008/wp08247.pdf"]http://www.imf.org/external/pubs/ft/wp/2008/wp08247.pdf[/url] - 641k - PDF
More information on this title

Transcript of a Press Briefing on the 2006 Article IV Consultation ...
March 05, 2007
... of strong and steady growth in the United Kingdom is likely ... this is our third year working on the UK, but I ... Is it something that the Bank of England should be ...
[url="http://www.imf.org/external/np/tr/2007/tr070305.htm"]http://www.imf.org/external/np/tr/2007/tr070305.htm[/url] - 30k - HTML

Public Information Notice: IMF Executive Board Concludes 2008 ...
August 06, 2008
Each Public Information Notice contains a background section, a table of selected economic indicators, and an Executive Board assessment.
[url="http://www.imf.org/external/np/sec/pn/2008/pn0899.htm"]http://www.imf.org/external/np/sec/pn/2008/pn0899.htm[/url] - 39k - HTML

Public Information Notice: IMF Concludes 2003 Article IV ...
March 05, 2004
Each Public Information Notice contains a background section, a table of selected economic indicators, and an Executive Board assessment.
[url="http://www.imf.org/external/np/sec/pn/2004/pn0415.htm"]http://www.imf.org/external/np/sec/pn/2004/pn0415.htm[/url] - 48k - HTML

Public Information Notice: IMF Executive Board Concludes 2004 ...
March 08, 2005
Each Public Information Notice contains a background section, a table of selected economic indicators, and an Executive Board assessment.
[url="http://www.imf.org/external/np/sec/pn/2005/pn0527.htm"]http://www.imf.org/external/np/sec/pn/2005/pn0527.htm[/url] - 44k - HTML

IMF Survey: Twin Global Shocks Dent United Kingdom Outlook
August 11, 2008
Global financial market turmoil and high commodity prices have compounded the strains affecting the U.K. economy. The difficult economic circumstances represent a major test to the United Kingdom's much-heralded fiscal and monetary policy frameworks, the International Monetary Fund says in its annual review...
[url="http://www.imf.org/external/pubs/ft/survey/so/2008/CAR081108A.htm"]http://www.imf.org/external/pubs/ft/survey.../CAR081108A.htm[/url] - 18k - HTML[/quote]

There's a 142 pages listed here not sure how many will relate solely to the UK, but have fun searching if you want.

It would be interesting to know when the IMF first warned about house prices.

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A few years ago commentators would read all their speeches and statements going back many years and had no fear of questioning politicians self serving contradictions. They would be able to spot the hypocrisy in so many of our politicians right away.

Not these days. For whatever reason they let them get away with it time after time.

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The sheer lies, arrogance and downright deceit from Gordon Brown is staggering!!
[url="http://business.scotsman.com/economics/Brown-warned-on-spending.2241742.jp"]Brown warned on spending [/url]
[url="http://news.bbc.co.uk/1/hi/uk_politics/1195309.stm"]Brown warned over tax cuts[/url]
[url="http://news.bbc.co.uk/1/hi/uk_politics/1299583.stm"]Brown warned over public spending[/url]
[url="http://www.tax-news.com/archive/story/IMF_Cautions_Brown_Against_Tax_Hikes_xxxx7550.html"]IMF Cautions Brown Against Tax Hikes [/url]
[url="http://www.independent.co.uk/news/business/news/imf-slashes-uk-growth-figures-says-leaked-fund-report-537308.html"]IMF slashes UK growth figures, says leaked Fund report[/url]
[url="http://www.guardian.co.uk/politics/2003/dec/19/uk.economy"]IMF tells Brown to cut £5bn in budget[/url]
[url="http://www.independent.co.uk/news/business/news/imf-urges-brown-to-cut-spending-as-uks-public-finances-deteriorate-698910.html"]IMF urges Brown to cut spending as UK's public finances deteriorate[/url]
[url="http://www.independent.co.uk/news/business/news/brown-rejects-calls-by-imf-and-eu-to-cut-spending-527764.html"]Brown rejects calls by IMF and EU to cut spending[/url]
[url="http://www.telegraph.co.uk/finance/2914081/Brown-raps-IMF-figures-on-Britain.html"]Brown raps IMF figures on Britain[/url]
[url="http://business.timesonline.co.uk/tol/business/economics/article382377.ece"]Disaster looms, but no one seems to care[/url]
[url="http://news.bbc.co.uk/1/hi/business/4269616.stm"]UK growth set to slow, IMF warns[/url]
[url="http://www.independent.co.uk/news/business/analysis-and-features/brown-steels-himself-for-fresh-clash-with-imf-over-outlook-for-uk-economy-507725.html"]Brown steels himself for fresh clash with IMF over outlook for UK economy[/url]
[url="http://www.timesonline.co.uk/tol/news/uk/article569336.ece"]Brown besieged over growth and borrowing plans[/url]
[url="http://business.timesonline.co.uk/tol/business/columnists/article569298.ece"]Brown is facing ghost of profligacy past[/url]
[url="http://business.timesonline.co.uk/tol/business/economics/article638744.ece"]IMF tells Brown to squeeze his spending[/url]
[url="http://www.guardian.co.uk/business/2007/feb/23/11"]Fears over light-touch regulation of foreign firms[/url]
[url="http://www.thisismoney.co.uk/mortgages/article.html?in_article_id=418120&in_page_id=8"]Property could slump, warns IMF[/url]
[url="http://www.guardian.co.uk/business/2007/mar/14/politics.economicpolicy"]Light touch helps City stake its claim as capital of the world[/url]
[url="http://www.independent.co.uk/news/business/news/brown-dismisses-fears-us-slowdown-will-trigger-a-worldwide-.htmlssion-444659.html"]Brown dismisses fears US slowdown will trigger a worldwide recession[/url]
[url="http://news.bbc.co.uk/1/hi/uk_politics/7628330.stm"]Ministers knew of housing bubble[/url]

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More gems:

[quote]Clear transparent procedures for monetary and fiscal decisions include presenting a full factual picture of the national accounts, usable central bank reserves[/quote]
Wasn't there a proposal a while back that the central bank would stop reporting on how much new money it's printing? and of course that future bailouts of banks could happen under parlimentary secrecy..

[quote]Because we must never return to the unsustainable burdens of debt of the 80s and 90s,[/quote]
And current UK debt including PFI is......


[quote]Of course it was and is right to say that inflation is costly,
and once out of control, it is even more costly to reverse.
macroeconomic stability, based on low inflation and sound public
finances, is an absolute precondition of economic success.
indeed there is a new premium on economic stability in the global
economy. a nation state relying on investment flows from round
the world - and also vulnerable to them - now knows that
retribution for getting things wrong is swift and terrible.[/quote]
Sounds pretty relevant - seems he's just concentrating on low inflation, while letting the sound public finances bit go hang.

[quote]The codes will require accurate reporting to the international
community, by each national economy, of all relevant information
- for example the size of a budget deficit, the state of bank
reserves and the level of currency liabilities.[/quote]

[quote]National governments should not pick and mix which standards they
choose to meet and which standards they choose to ignore. so
proper implementation of the codes should be a condition of any
imf and world bank support. in the global economy national
governments have rights but they also have responsibilities they
must meet.[/quote]

So gordon.. lead by example!

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