Saturday

G7 Finance Chiefs signal economic repair; underestimate excessive state action

-Posted by D. Worth (US) | for- M. Barbay (France) and US

Worst of World recession may be over.
Washington The G7, which comprises the United States, Britain, Canada, France, Germany, Italy and Japan, met a day before the International Monetary Fund and World Bank begin their twice-yearly meetings. read. VIDEO: G7 Meeting

Image: "Cash Room" U.S. Treas. Dept; Wash D.C.

One of Geitner's questions was whether they were "doing enough to lay the foundation for a more balanced, more sustainable recovery?" he said.

In my view, it is worth questioning the extent of mass infusion, as government injection of funds into banks, is already giving rise to a "two-tiered banking system"... And Geitner's assessment of "balance" hinges on an estimated U.S. tax-payer-base, of which 39% are already paying 89% of the total tax before bailouts! An answer of "more government infusion" will LEAST sustain recovery; even with an HUGE 'inflationary' tax of Cap and trade.

Tax-targeted earners are NOT willing to forfeit ALL income plus 10%... What U.S. Government is likely to impact is an increased recipient base, and decreased tax-payer base...
Will they listen to the chairman of Swiss banking?
Credit Suisse warns of 'excessive' state action The Swiss banking giant warned against excessive government intervention in the lending policies of banks that have been bailed out by the state.

Kielholz acknowledged during the bank's annual general meeting that state intervention had been necessary to prevent a meltdown of the entire financial sector. But the action by governments to inject funds into banks was already giving rise to a "two-tiered banking system"...
"This has led to a distortion of competition, particularly in the refinancing market or in terms of client guarantees," he explained...

"There is also uncertainty about how and when governments will be able to exit their stakes in these companies," he added.
In addition, he cautioned against over-regulation of the sector, saying that while stricter supervision has been prescribed for the sector, the "benefits of additional regulation have yet to be demonstrated."

"In particular, I believe there is a risk that these changes could be exploited as a means of ushering in protectionist measures." read.

Time for the Obama Administration to stop the Corporate Welfare, and allow the economy to purge the loss... This is the time to cut tax for the job creators, to get people back to work! And as most economists explain of the significant economic risks of rapidly expanding the size of government... If only we could program Obama's teleprompter, to prevent further damage! IMAGE.



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