Davos

There's a conf'rence of world VIPs
Taking meetings in spas and on skis;
By Switzerland's hills
They solve the world's ills,
Or at least decide who's the big cheese.

Every year at this time, the gloom of January is brightened (or deepened, depending on your viewpoint) when central bankers and business leaders from around the world gather in Davos, Switzerland to discuss the world economic outlook.  The World Economic Forum is "committed to improving the state of the world" and, according to the organizers of the annual meeting, it "remains the foremost creative force for engaging leaders in collaborative activities focused on shaping the global, regional and industry agendas." Others take a more cynical view, including Bloomberg radio commentator and former SEC chairman Arthur Levitt, who has given up going to Davos, remembering it as a social competition in which the object was to collect the greatest number of prestigious names on one's "dance card."

Those prestigious names are now concerned over the possibility of systemic financial failure, according to a report by Reuters.  Over 1,000 central bankers and business leaders were surveyed ahead of the annual meeting, and it turns out that they are worried about all the excess liquidity that the former have pumped into the system for the benefit of the latter.  Recurring asset bubbles and "currency wars" of internationally competitive devaluations are some of the other concerns that keep the power elite uneasily awake through those snowy Alpine nights.

Davos: Private Gain, Public Pain

There's a forum for serious chatter
By the bankers and leaders who matter,
Who will see, when they're done,
That the debts of the one
Are obligingly backed by the latter.

This week, the global business and political elite meet at the World Economic Forum in Davos, Switzerland. Founded in 1971, the WEF describes itself as an international organization of large corporations "committed to improving the state of the world" with "no political, partisan or national interests." But, says Bloomberg columnist Jonathan Weil, "It’s becoming hard not to suspect that the annual gathering in Davos has become a conclave for global elites to promote crony capitalism and state-backed enterprise, ensuring that national coffers remain available to be tapped for private gain." Exhibit A in Weil's case against the Forum is its Co-Chair, Citigroup CEO Vikram Pandit. Angrily detailing the ways in which Pandit has "failed upwards" at his former hedge fund and then at Citi, ultimately taking multiple federal bailouts while declaring his institution to be sound, Weil concludes, sarcastically: "These little rough patches in the financial industry offered just the kind of hands-on experience the forum’s organizers were looking for in a leader, in which case they found their man."

Henrique Keeps It Real

"Look upon me and be jealous,"
Says Brazil's central banker, Meirelles;
"Down here in the South,
We don't live hand to mouth -
We're net dollar creditors, fellas."

No Sure Footing on the Summit

At the annual forum in Davos,
US policymakers are nervous;
In the crisis at hand,
There's no pent-up demand
To be pressed into crash-ending service.