Mish reports on Bush’s summit, and submits that the few people who called this financial crisis early should be there, instead of those who will be. With a couple notable exceptions.
In response to the Credit crisis president Bush is gathering up all the people who did not see what was coming, denied what was happening, and then failed to see the implications of what was indeed happening.
President George W. Bush said he will host a summit on the global financial crisis in the "near future" and he is confident the world’s nations will weather the breakdown in credit markets.
"For this meeting to be a success, we must welcome good ideas from around the world," Bush said as he welcomed French President Nicolas Sarkozy and European Commission President Jose Barroso to Camp David, the presidential retreat in rural Maryland, for dinner and three hours of talks.
The conference agenda will include ideas on how to prevent future crises in a way that preserves the free-market system, Bush said. "It is essential we preserve the foundations of democratic capitalism," he said. He said leaders from both developed and developing nations would be included.
"We must reform capitalism so that the most efficient system ever created doesn’t destroy its own foundations," Sarkozy, 53, said yesterday in a speech to Quebec’s National Assembly. Sarkozy represents all 27 nations of the European Union.
Sarkozy and Barraso are pressing Bush for a G8 agenda that includes stiffer regulation and supervision for cross-border banks, a global "early warning" system and an overhaul of the International Monetary Fund. Talks may also encompass tougher regulations on hedge funds, new rules for credit-rating companies, limits on executive pay and changing the treatment of tax havens such as the Cayman Islands and Monaco.
Capitalism Reformed To Death
The problem with capitalism is that it has been reformed to death already. Now we see the Orwellian concept of putting in place a Brave New World To "Preserve" Free Markets.
It is a serious mistake to think we need to take over the free markets to save them. I have a better idea: why not let the free market work? Before one can fix anything one must first understand what the problem is.
- The Fed
- Fractional Reserve Lending
- Runaway Congressional Spending
Summit of Winners
Instead of holding a summit of losers, why not hold a summit for those who saw the mess coming and are far more likely to know what to do than those who did not see this mess coming.
There is one more gotcha to the summit of winners ideas. That problem is that a few of the people that did indeed see this crisis coming are proposing the same failed Keynesian policies that brought about this crisis in the first place.
Krugman and Roubini need to be excluded from the summit of winners.
At the top of my list of those who understand what the problem is and also what to do about it is Congressman Ron Paul. There are simply too many relevant articles by Ron Paul to list one of them as a highlight.
Lew Rockwell has a nice collection called The Ron Paul File that is another good starting point.
Click Here For Marc Faber: Let the crisis burn itself out.
Marc Faber is second on my Winners List.
"The best thing to do is let the crisis burn itself out even if it means pain for some people. The problem is leverage, and the biggest hedge funds are Fannie Mae and Freddie Mac with leverage of 150-1, under the eyes of Congress and the SEC. Nobody did anything about it and then people go bitch about the short sellers. … And who supplies the leverage into the system? It’s called the Federal Reserve board!"
I have had and still have my differences with Peter Schiff as noted in Not Your Father’s Deflation: Rebuttal and Peter Schiff Replies to Deflation Rebuttal but with the exception of an short and silly reference to Zimbabwe this is an excellent video.
In spite of my differences with Schiff on inflation vs. deflation in the near future, I nominate Peter Schiff to my team of winners for what to do about this problem.
I also nominate Frank Shostak to my team of winners. Please consider this audio with Austrian Economist Frank Shostak on Mises.
If you saw this crisis coming, understand that it was the Fed, the SEC, and fractional reserve lending that caused this mess (as opposed to a lack of regulation), and recognize that the best thing to do in the immediate future is nothing, then add yourself to the winners list.
In terms of what to do about the current crisis my proposed winners conference could be concluded with one word "Nothing".
However, it will take a plan and a timeframe to abolish the Fed, abolish fractional reserve lending, and return the world to a system of sound currencies backed by hard assets. I do not think that can happen overnight. How to accomplish that mission is what the economic conference should be about.
Instead, I fear we are going to see a conference of losers, sponsored by a loser, with losing solutions to the problem.