DESPATCHES

Just back from Washington and the World Bank/IMF meetings. Didn't get around much as the real purpose of the trip was a family wedding but did run into a few old buds who were attendees. What happened? Nothing, absobloodylutely nothing. And therein is the tale. Try as he might, The Suit and his trolls were told to piss off by practically the entire world when it came to China, the Yuan and vague American threats as to what might happen if everyone didn't play ball. It wasn't pretty. For some, our importance in world finance is somewhat south of that of Pago Pago. Indeed, if one were to be completely honest, there are snickers behind the sneers. It is a sad thing to see.

In addition, the one institution that was always held in the highest of regard, the Fed, is now considered in certain circles as simply an extention of the Treasury and the Administration as a result of what most attendees believe to be the crazy rush to once again inflate the Fed balance sheet trough the almost-certain purchase of Treasury debt which no one has any real hope will improve the economic picture. Indeed, many Euros, I am told, are horrified at what they believe to be the greatest threat to currency and inflation stability they have ever seen. We have discussed the likely outcome of this planned operation and will continue to do so later this week, but from what I have been told, there is virtually no chance that this will not occur: the die has been cast and the exercise will begin immediately after the elections. In short, the power and influence of the United States in a financial sense has never been lower in my lifetime and is being openly discussed in the great halls of influence. I've never seen that before either. For us, this meeting was a catastrophy.

Oh remember my comment about the IIF wanting to reduce the G20 by more than half and excluding the UK? Couldn't figure it out so I asked one in the know. "Charlie," said he, "remember the story our bud, Gordon, used to tell about the meeting his Da had with the German client?" Seems as though before of word of business was discussed the German reminded this Brit (Gordon's Da) that the national side had just defeated the English in a friendly two nights before. "Ve are so sorry that ve vere forced to beat you at your national sport," said the visitor. Gordon's da, without a moment's hesitation replied, "That's allright old sport, we beat you twice at yours this century."

No business was done, but things haven't changed much. Old Joe Ackermann is the money behind the IIF and he has no truck with the position the Brits are taking in regard to banking in Euroland. Not good for Deutsche Bank so Joe told Charlie DeLara to give the two fingured salute to Blighty
In private Charlie runs away from the position but when you're getting paid $2 million a year the first thing out of your mouth is, "Yes sir, yes sir, two bags full sir!" The love and respect among the Euros is a joy to watch. Now of course one would be correct in pointing out that Joe is really Swiss...just remember, they were all Swiss in 1945.

See you tomorrow.