Friday, September 26, 2008

MDG's, Financial Crises and the Future

Although this is an unpromising time for countries to pledge support for aid against hunger, poverty, disease and for education, and the track record of converting pledges into actual donations is abysmal, yesterday the NY Times reported that donations from the private sector were forthcoming,

the Bill & Melinda Gates Foundation made among the largest commitments from a nongovernmental entity. It pledged $168.7 million for fighting malaria and joined with the Howard G. Buffett Foundation in a $76 million pledge to help poor farmers win competitive prices for their crops.

The effect of a stalled bailout on the world economy is palpable. E. J. Dionne in the Washington Post clarifies,

The simple truth is that Washington is petrified about this crisis and will pass something. There are dark fears floating through the city that foreign investors, particularly the Chinese, might begin to pull their billions out of our system.

Scarier than the bad mortgages are those unregulated credit default swaps that financier George Soros has been warning about. There are $45 trillion of those esoteric instruments sloshing around the global financial system. They were invented as a hedge against debt defaults, but even the financial smart guys don't fully understand their impact or how to price their real value.

In addition to everyone else, Gordon Brown is in Washington meeting with President Bush on the economic situation saying, "British families would want to know everything possible was being done to secure stability."

Insisting the Bush meeting had a practical purpose, Brown said: "While the problem comes out of America, it has consequences for all of us and every family will want to know that we are doing everything in our power to ensure that there is stability; and that is stability for people's jobs, for people's mortgages, for people's standards of living."

Meantime, have a look at this provocative piece on Daily Episcopalian. And get ready for the debate tonight.

2 comments:

Country Parson (Steven Woolley) said...

A local bank here in town is family owned and its trust department manages most of the areas wealth. On Friday their chief officers held the first of three over subscribed sessions explaining what the crisis actually is, how we got there, what the bailout would accomplish and why that is important to the local economy. It too a skeptical audience a long time to apprehend that this is not about bailing out a bunch of greedy fat cats on Wall Street, it's about them, the farmers, ranchers, small business people and retirees of our valley. But word on the street is that very few people understand that and are inundating their Republican members of Congress to let Wall Street sink, it serves them right. An overly simple analogy would be a sinking cruise liner with the passengers, acting under the delusion that they were not themselves on the same ship, yelling at the Coast Guard to go away because the careless captain and crew deserve to sink.
CP

Country Parson (Steven Woolley) said...

I hate looking at a comment I sent without proofing and finding all my mistakes. I trust that readers, and especially DG, will be tolerant. I feel a little like the Guardian publishing a correction of an article on misspelling while misspelling misspelled. Maybe I could go to work for them.
CP

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