G-20 faces urgent task of averting trade war

“The most important thing that the United States can do for the world economy is to grow, because we continue to be the world’s largest market and a huge engine for all other countries to grow,” Obama said at a news conference.

Huge engine...Size does matter but more importantly is it in working condition and how far its effective? It is Emerging Markets (combination of small engines) that are trying to pull out developed countries from recession and have kept the global economy afloat !

what planet is silva and other leaders living on.. how can us,uk keep buying when they dont have any money?

what a shock, 20 nations can't agree. These "meetings" along with the G8 are a complete waste of time.

Until the economic system is in line with the natural system of the planet, which has limits i.e. no infinite growth, then the system is a fail and will always be so.

Change from a Conservation of Debt to a Conservation of Value based monetary system would put investment on saving from declines rather than growth via subtraction. In doing so we'd be on the same side of nature and continue economic activity rationally.

G20 can't do that. Peak Oil will solve a lot of this stuff for us though.

a waste.

sf2k, in layman's terms please, too early ;)

Never mind, we are getting used to this. At least the 'Let's go' song the Koreans made for this G-20 meeting was great and the scandal with the Australian Prime Minister Gillard paper puppet dressed as a Dirndl was hilarious.

lovejapan21

well think of energy. We all need it and it drives everything, even nature itself. So if we price carbon or whatever then there is a market. To do things efficiently a business needs to be energy efficient to avoid the price on energy.

So, energy is the bastion of you the citizen depending where you live. With a credit per month or per year, that credit is then applied like a service to you. You're a citizen after all.

If you're wealthy, then the credit isn't enough to pay off all the expensive energy toys so hopefully you reduce them.

If poor then there are credits to put towards not being poor, better food and opportunities.

The irony is that it would thus be the poorer people who use less energy who would have more credits to invest in businesses rather than the overspent wealthy people.

So it's still a market system, using energy as the foundation, and then local credits to determine supply and demand of company investment based on who has more credits.

Money is thus not loaned into existence, only based on available energy. Thus this puts pressure on lower populations since higher would have fewer credits between them as well.

Thus investments go toward local energy not imported energy. Local systems thus benefit. By being more efficient and with a system in line with what is available then that over time reduces our excesses and prices our pollution and wasteful habits.

I'm kind of mulling it over, but I don't see a problem with it. It becomes a gradual process, works from within the current system without requiring wholesale replacement, scales however you like, and keeps choice and democracy and accountability without getting into -ism's and indignation subsidy hell.

I call this the Conservation of Value, as I'm trying to swap the current Conservation of Debt. Term may be already used, but it makes sense to me.

:)

Some countries, such as the United States, want China to let its currency rise. Such a move would put a dent in China’s huge trade surplus with the United States

That was the same logic behind the Plaza Accord in 1985, when Japan agreed to let its currency rise. Twenty-five years later and Japan still has a trade surplus with the USA. If you got little to sell, and the other country has barriers to what you actually do have to sell, then nothing will change. Just price inflation for the schmucks at the billy five and dime company store. And China thinks that Japan committed economic suicide by letting the yen rise, because that led to the bubble, and they have no intention of doing the same.

And that $600 billion. Other countries have a very good reason to be angry. Just a gift to Wall Street. They take the money out of the USA, buy assets around the world and push up the prices, and push down the US dollar. Then sell at a profit, and convert back into cheaper dollars. A plan for the rest of the world to subsidize the zombieland of bankrupt American banks, that is all it is.

G20 cannot agree with anything. Let's go back to G7.

And that $600 billion. Other countries have a very good reason to be angry.

Yep, and Fed is talking about printing more money QE3 and QE4. The truth of the matter is that banks are not using that money to stimulate US economy. Instead they are investing on commodities, emerging market and offshore investments.

Yep, and Fed is talking about printing more money QE3 and QE4. The truth of the matter is that banks are not using that money to stimulate US economy. Instead they are investing on commodities, emerging market and offshore investments.

Exactly so why should anyone else listen to what the USA wants to do with the economy, all it wants to do is screw everyone else, obama even said he wants to double U.S. exports. The only way that will happen is if the dollar is worthless as american products are basically cr@p and no one else wants them unless they are dirt cheap. All this QE Cr@p does is screw eveyone else's economies.

To paraphrase GW Bush's remark over steel tariffs decision in 2002: United States' a free-trading nation, and in order to remain a free-trading nation, the Americans must enforce law and be pragmatic over import tariffs.

SUCH WISDOM IS WHAT THE REGION NEEDS NOW-- the world needs a little Ronald Reagan protectionism.

Resisting protectionism should not entail a pledge on trade liberalization that vows NO TARIFFS (as the Trans-Pacific FTA is aiming to bolster) to trading partners, removing much needed sources of nat'l income as trade off to f r e e access to the US and other large markets, and have your industries and consumer markets subjected to hasty, additional measures for the sake of liberalization.

People who would have us duped that internationalized commerce would fall without robust trade liberalization are simpletons, they're simply unaware of history. Even the great John Maynard KEYNES-- the economist whose ideas dominated the macroeconomic policies of the last century-- would have been agitated by the current malaise (and one-eyed solutions) now gripping the world (and its policymakers), that KEYNES would surely advise against a liberalizing climate on trade in Western economies.

KEYNES was after all, suspicious of 'crowding out'-- borrowing to sustain public works, and big, indulgent spending in the presence of a 'saving glut'. Ronald REAGAN too, much like Sarah Palin recently would have been disappointed with the QE2 of the Fed Reserve and the nonchalance afforded to the collapsing US dollar.

BUT THE APPLE FELL TOO FAR FROM THE TREE... and today, economic commentators in the US would rather egg the Sth Korean economy rather than their own, as surely 'crowding out' is least disruptive to them.

It's going to be pretty hard to avoid the protectionist measures that could come up. China isn't going to raise the value of its currency and hurt its exports just so that the US can sell more, and everyone's going to be upset when the US eventually floods the market with money to lower it's own currency for exports.

I think we'll see this get worse before it gets better, for some nations.

BUT THE APPLE FELL TOO FAR FROM THE TREE..

Indeed. Just keep this in mind and it will help you understand all this stuff. 99% of post-war American economic theory is complete junk. Rubbish. Bollocks. Just a lot of crap to give cover for asset stripping and wealth extraction. Now that things are blowing up on them they don't have a clue what to do, because all they understand is the junk economics that got them in this mess in the first place. And all the guys who could have explained it to them like Keynes, Fisher, Minsky, etc. were ignored and are now long dead.

But nothing is happening that was unpredictable to people who actually understood or understand economics, as opposed to American economic fundamentalism.

The system will always lurch from one crisis to the next until we have true capitalism and an end to the corporate welfarism sham that currently operates.

LOVE HOW THE WORLD TURNED TOPSYTURVY-- Heard that Sarah PALIN just blasted QE2 and cited Paul KRUGMAN!

"In other words, pushing inflation upwards means you can have your cake and eat it too. You can spend all you like and then make the bill disappear by driving down the value of the dollar -- buying with one hand the debt your reckless spending is issuing with the other. No need to cut spending, folks, just run the printing presses." (From source)

OF COURSE, she's right-- and will be proven right if the direction on consumer spending proves dire in the end. BUT EVEN IF consumer spending would improve in the US, in coming months-- the United States have obviously sold themselves to borrowing-and-spending (check above post on 'crowding out').... and the only way for the United States to remain competitive and no1 is through workplace reforms (not that there's much leeway there except in steelwork industry) and increased outsourcing and lowering of tariffs on imports.

But nothing is happening that was unpredictable to people who actually understood or understand economics, as opposed to American economic fundamentalism.

SO THE G20 TRYING TO AVERT TRADE WARS IN THE NEAR FUTURE WILL obviously prove futile.

I agree, nothing that these people do or say will prove helpful. No one's buying it :(

No trade woes ...just Trade unity,tolerance and love....Rock to rhyhtm of trade..G20

Simple Solution : Surrender to Emerging Markets... ! Yuan is powerful than Yen/Euro/$ !

The system is not working, there will be another crash soon how can this be the best system of commerce available. We need a stable system not a unpredictable casino type system we currently have.

Wage convergence will obviously hit the tipping point... It's here and I think a G20 pledge to resolve differences' have to be mulled sometime soon. And before you even consider additional trade liberalization, deal with this one first!

No trade woes ...just Trade unity,tolerance and love....Rock to rhyhtm of trade..G20

yes, this is 21st century and economy should be run by priests or pandits :)

some14some..economy should be by pundits, borrowed from indian word pandit(means priest)... A pundit is a person who offers his opinion on politics,sport or any subject, of which they are knowledgeable...

AND THE PUNDIT IN ME SAYS-- think-twice on trade liberalization, think-twice on unscrupulous government spending in the United States, and the status quo's solution to salvage the global economy against the rising tide of the the savings glut S U C K S!

The solution is simply, and everybody knows it. American need to change their habit and cut back their spending: you can't spend by printing money or borrowing forever. But this can't be done by an order or trade policy, just like in Japan people don't spend much. It's a culture thing, a habit, you can't order Japanese to spend neither.

I hope Mr.Obama can help other countries defend themselves from too many cheap Chinese imports that are taking away the jobs of many people not only in the USA but also in Mexico and elsewhere.

In the end we're all just waiting to see if there will be deflation or not. We can worry about the other things after that.

Ahhh what the hell? In the end, only food - water -air is im portant, metal/paper /plastic money is only for playing around so human can have fun!

G-20 faces urgent task of averting trade war

Waiting for smithinjapan to tell us he saw Willy Brandt among the leaders there.

In the end we're all just waiting to see if there will be deflation or not. We can worry about the other things after that.

I see no deflation in SYDNEY!

I see no deflation in SYDNEY!

I had to get out of my chair... had to check outside, and double-check and George Street doesn't appear to be dealing with deflation......