Financial Crisis, 13 Mar 2009: Dow 7,223.98, +53.92 (+0.75%)

Today the market rose to close the week up, with the Dow Jones Industrial Average back over 7,200. It was up 53.92 points on the day (+0.75%), ending at 7,223.98. For the week the Dow bounced back nearly 600 points over the prior week’s close of 6,626.94, recovering all the losses of the prior week and well over its close at 7,062.93 of two weeks ago. That is a rise of over 9% for the week, and a net rise for March of 2.28%.

Though this is welcome news, having a “two-week high” is nothing to really get complacent about. World Bank President Robert Zoellick warned of all economic stimuli giving the world economy a “sugar high” speaking in London before the start of the G20 Summit.

Another bit of good news for the “buy American” crowd was that the U.S. trade deficit fell 9.7% to $36 billion for the month of January. This was down $2 billion compared with expectations. Adjusted for inflation, the real trade deficit was $41 billion. However, this news must be couched in the fact that all global trade is significantly down for the year. And in the long run, it could hurt many industries and international relationships that rely upon global trade for their success.

Many elements of the world economy are still shaking out after the downturn. European powers are considering protectionism. They are still in a great deal of insecurity over their eastern European debt obligations. Austria, which had extensive dealings with eastern Europe after the fall of the Iron Curtain, now finds itself in a greatly insecure position.

China is trying to avoid having its trade deficit with the U.S. shrink, and is mulling over the security of U.S. Treasury bonds. Meanwhile, the U.S. has dispatched a Navy destroyer, the USS Chung-Hoon, to protect a maritime surveillance ship, the Impeccable, off the Chinese coast. Along with the other issues, a prognosis of uncertainty is developing between the U.S., the present pre-eminent world power, and China, the developing powerhouse of Asia.

So while the news for the week is extremely good for the short term, there remains a great deal of uncertainty for the coming year ahead.

Financial Crisis, 12 Mar 2009: Dow 7,170.06, +239.66 (+3.46%)

For the third straight day, the Dow Jones has ended higher. For the first time this month, the Dow closed above the 7,000 mark at 7,160.06.

A Dimmed Light Shines Brighter

General Electric, even though it was downgraded by Standard & Poor’s from AAA to AA+, jumped up $1.08 a share, up 12.72%, to $9.57. Investors had worried the downgrade would have been even worse.

If Not a Bottom, a Ledge

Meanwhile other aspects of the economy looked to be settling according to the U.S. Department of Commerce. Retail spending in February, though still down slightly by 0.1%, was not as bad off as some forecast. Excluding automotive industry, it was actually up 0.7%. Overall retail spending in January, even including the automotive market, was actually up 1.8%. Unemployment remains a chief worry to the sustainability of the consumer spending rate.

The present week has been a welcome relief to a market that has seemed nearly in free-fall since October of last year. While prospects are still too murky to determine if this is a bottom to the crevasse, it is possibly at least a ledge that the market has landed safely upon.

Madoff Guilty

Today also marks the day that Bernie Madoff pled guilty to running a massive corrupt investment scheme that lost billions. “I operated a Ponzi scheme,” he told the U.S. District Court judge.

Go to G20

The leaders of the G20 are preparing to meet this week. The U.S. is proposing two major initiatives:

• Push for a 2-year stimulus plan from all G20 nations equal to 2% of that nation’s GDP. The U.S. stimulus plan signed by President Obama is already equivalent to 3% of GDP.
  

• Expand the IMF’s emergency fund for developing nations from $50 billion to $500 billion. The U.S. would contribute $100 billion to that fund and would seek other nations to underwrite the other $400 billion in necessary funds.

Many of the nations, however, are so strapped for cash and credit that they are not willing to make such a commitment.

Stay tuned for the news from the G20 summit later this month.

Financial Crisis, 11 Mar 2009: Dow 6,929.68, +3.19 (+0.05%)

Today the market flirted with the 7,000 mark, crested it, and then spent the day in up-and-down trading. A late-in-the-afternoon rally almost brought the Dow to a close at the 7,000 mark, before a final tumble to close just 3 points higher than the previous day.

The intraday low was 6,867.55, meaning that the present support for this level is not firmly established. With the Dow plunging and rising hundreds of points per day, we will likely see a great deal of volatility yet to come.

The general trend for the day was a rapid peak in the AM, followed by a long steady decline. The reversal of that trend to the end-of-the-day rally somewhat mirrors the experience of 6 March 2009, when the market hit new recent lows.

The good news is that at 6,929.68, the Dow has recovered 7.6% from the low of 6,440.08. The unknown propositions are whether it will be able to remain above that point, and whether we have reached a valley, or a bump on the downward slope.

The airline industry, for one, sees that there may be some fair weather flying ahead. Delta, for one, saw “revenue trends stabilizing and not getting worse.” BofA-Merrill Lynch even upgraded JetBlue.

The issue about whether we’ve reached bottom requires everyone to consider “capitulation.” When some people simply abandon their positions in the market and take their losses. Mark Hulbert of MarketWatch is not convinced we’ve reached a point of capitulation yet, and warns that to be too overly bullish at present may be mistaking a bear market rally for the real McCoy of a reversal of a down trend.

Financial Crisis, 10 Mar 2009: Dow 6,926.49, +379.44 (+5.8%)

Yesterday the Dow Jones Industrial Average (DJI) roared back up 379.44 points to close at 6,926.49, up 5.8% on the day. This raised the Dow to close to its February close, just above 7,000.

The good news in perspective shows how far the market has yet to recover. It was still down over 2,000 points on the calendar year 2009, which it began over 9,000. For the full twelve month proceeding period, it is far off the 13,000+ value it held back in May 2008. It is estimated by Stephen Schwarzman of Blackstone Group LP that 40-45% of the world’s wealth has been destroyed by the downturn.

Yet for Wall Street and for those dependent on their portfolio, 10 March 2009 was a welcome relief.

The market cited the reason for the significant uptick was surprising news from Citibank, which internally shared a memo it had made a profit in the first two months of 2009. That message leaked to the market, and there was a definite bounce.

Other good news included Rep. Barney Frank, Chairman of the House Financial Services Committee, saying that the “uptick” rule, which curbs short selling, may be reimposed by the Securities and Exchange Commission. While in prior days many free market philosophies would have seen this as government interference, in today’s market active involvement of watchdogs is seen as a healthy thing for all parties.

Financial Crisis, 6 Mar 2009: Dow 6,626.94, +32.50 (+0.49%)

The Tao of Dow

The week ended on a massive rally. An brisk morning start began Wall Street’s day 50 points higher than the prior evening’s close, and a quick surge led the Dow Jones Industrial Average (DJIA) to an early intraday high of 6,755.17.

However, the swift exuberance was extinguished shortly after 9:45 AM, and the rest of the day was a rocky decline, dipping below the 6,500 level before before 3:00 pm. The intraday low of 6,470.11 was hit right around 3:24 pm. Then, something sparked in the market, and the last half-hour was filled with a massive upsurge to close at 6,626.94. For the day, the Dow was up +32.50 (+0.49%).

It was the silver lining to a terrible week. Had the last half-hour not occurred, the market would have been down over 400 points on the week. As it was, it was “only” down a little over 300 points, from 6,932.23 Monday’s opening to Friday’s close at 6,626.94. This is net drop of 4.4% for the week as a whole. Except for one thing.

The prior week’s Friday close was 7,062.93. Given a Friday-to-Friday analysis, the week was down just shy of 436, or –6.17%.

The market had held up reasonably well for the first half of the week, cresting the 6,950 point twice in the week (Monday and Wednesday). Yet resistance collapsed on Thursday and Friday with the terrible economic news of more job losses and talks of insolvency for General Motors.

Unemployment Rate Crests 8.0%

As reported by Madlen Reed of the Associated Press, the U.S. government’s Bureau of Labor Statistics released figures that the economy has been shedding well over 600,000 jobs each month for the past quarter:

Month	Job Losses	Jobless %
December 2008	681,000	7.2%
January 2009	655,000	7.6%
February 2009	651,000	8.1%

One can read the Bureau’s report directly online. The release of the Employment Situation begins grimly:

Nonfarm payroll employment continued to fall sharply in February (-651,000), and the unemployment rate rose from 7.6 to 8.1 percent… Payroll employment has declined by 2.6 million in the past 4 months. In February, job losses were large and widespread across nearly all major industry sectors…

The number of unemployed persons increased by 851,000 to 12.5 million in February, and the unemployment rate rose to 8.1 percent. Over the past 12 months, the number of unemployed persons has increased by about 5.0 million, and the unemployment rate has risen by 3.3 percentage points.

Among the unemployed, the number of job losers and persons who completed temporary jobs increased by 716,000 to 7.7 million in February. This measure has grown by 3.8 million in the last 12 months.

The number of long-term unemployed (those jobless for 27 weeks or more) increased by 270,000 to 2.9 million in February. Over the past 12 months, the number of long-term unemployed was up by 1.6 million.

As major corporations continue to have unstaunched losses, and as Wall Street melts, the possibility is for small corporations and individuals to move into market segments to compete — if, and this is a big if — they are able to free their own capital or to raise funds from other sources, and if market conditions and regulations allow them to enter business unfettered.

Otherwise, key opportunities will pass for small businesses and individuals too, causing markets to shut down completely.

The stimulus bill, ideally, is geared to address joblessness immediately. Without a change in the current economy, joblessness will rise to well over 10-12% in the span of the next quarter or two, causing even more chaos.

Rent and Torn

While everyone is focused presently upon the home buyers fiasco, increasing unemployment can also lead to massive disruptions to renters also. Property management companies are being hit as people have to leave their present rentals as jobs dry up, or they may decide to room together to save rent, Many newly completed apartment complexes or recently purchased properties are finding they are already underwater and priced out of the present market.

The UK is seeing a rapid decline in rental values over the past year, upwards of 11.7% in areas around London, and 14.3% around Manchester, as the economy tightens and more home owners put unsold properties out for let.

New York City is likewise seeing a decline in rentals, too. Given various incentives being offered by landlords, rates have been calculated to have dropped upwards of 10-15%, as reported by the New York Times on 30 January 2009.

The word “recession” has been used so far, though the use of the term “depression” is now starting to be considered, such as by this article in the Salt Lake Tribune. We would have to reach an unemployment rate of 10% and be in this crisis for three years before it formally qualifies according to technical definitions. The old joke cited by Amity Shlaes indicates the key difference: “A recession is when you lose your job. A depression is when I lose mine.”

Yet for many in the United States today, the symptoms already clearly indicate the condition. Such patients cannot afford to wait for the formal diagnosis. And for millions this is not an easy joke to laugh off.

Financial Crisis, 25 Feb 2009: Dow 7,062.93, -119.15 (-1.66%)

Today began and ended badly, with a bit of modest hope in the middle.

At the opening bell, the Dow opened far below the close of the prior day, at 7,099.49. Within the first hour, it had sunk to an intraday low of 7,033.62. The rest of the morning was an uphill struggle. By noon the index climbed to 7,180, but met resistance which it was unable to overcome.

The rest of the afternoon was filled with Wall Street digesting the most recent proposal for the U.S. government to salvage ailing Citicorp, along with news of the worst annualized quarterly dip in GDP for the past 25 years: a drop of 6.2% in the fourth quarter of 2008.

During the afternoon, the market eroded. From the intraday high of 7,195.46, prices tumbled first after the 2:00 pm bell, then after the 3:00 pm bell, and finally, in the minutes before the closing 4:00 pm bell, until the market closed at 7,062.62, thus setting a new annual low.

In all, the U.S. market has already lost 18%-20% of its value since the beginning of the year.

Market Index Performance
27 February 2009

DJIA
Day: -119.15, –1.66%
Week: –4.1%
February: 11.7%
Year-to-Date: –19.5%

S&P500
Day:
Week: –4.5%
February: 11%
Year-to-Date: –18.6%

NASDAQ Composite Index (COMPX)
Day: –13.63; –0.98%
Week: –4.4%
February: 6.7%
Year-to-Date: –12.6%

Wilshire 5000
Day: –145.50, –1.91% (7,473.97)
Week: –4.96% (from 7,863.89)
February: –10.42% (from 8,343.79)
Year-to-Date: –20.2% (from 9,364.50)

Sources:

• William Hennelly, TheStreet.com
• finance.yahoo.com;
• www.wilshire.com/Indexes/Broad/Wilshire5000

Financial Crisis, 25 Feb 2009: Dow 7,181.78, -88.81 (-1.22%)

Once again the Dow closed down below 7,200. It was up for most of the day, peaking in the morning hours above 7,400 (7,204.31 to be precise), before cascading down the rest of the day.

This is the fourth day this week the Dow sunk below 7,200, and the second day this week it closed below that point. Based on the trend established after declining from the highs over 9,000 around early January, the Dow seems poised to fall to 7,000.

Tomorrow may prove a crucial test of support above that number.

Financial Crisis, 24 Feb 2009: Worldwide Slump, Latvia Collapses

Mountain View, CA (Global Understanding)

Markets around the world are reeling at the pressures brought about by the global economic crisis. It cuts across all sectors: financial, credit, manufacturing, exports, energy, transportation, tech. There are few safe haven economies, few stocks, few sectors. According to reports from the Davos conference, the global crisis in the past five tumultuous quarters has already destroyed 40% of the world’s wealth.

Latvia Collapses, Eastern Europe Teeters

In addition, governments are continuing to collapse due to the strain of recession. First there was Iceland. Now the east of Europe braces itself. Latvia is in the throws of a 12% retraction of its economy. Under intense domestic pressure, including violent protests in January, Latvia’s Prime Minister and government resigned on Monday (22 Feb 2009). The IMF plan to rescue its economy is at risk of faltering. Swedish banks, who hold much of Latvia’s debt obligations, are worried over default.

All of Eastern Europe is teetering on the brink. The Ukraine, a far larger nation than Latvia, is likewise facing a 12% contraction of its economy. An outstanding debt obligation of $1.7 trillion from Eastern European nations towards the rest of Europe represents a hanging sword over the Euro zone economies.

If even 10% of the debt of Eastern Europe defaults, as many fear including Ambrose Evans-Pritchard writing in the 15 February Daily Telegraph, it can cause a panic in the Western European economies and lead to a global economic collapse.

The Human Toll: 400,000 More Children Projected to Die in 2009

To put the global crisis in perspective, the World Bank now estimates that an an additional 400,000 children around the world will die in 2009 due to their families falling into extreme poverty. That is an increase in the overall global death rate of 6 per 100,000.

It is the equivalent of taking the entire urban population of a city the size of Miami, Florida, or Oakland, California, and starving it to death.

Though times are tight, consider providing to an international relief organization this year. You may save a life, or a whole family.

Financial Crisis, 23 Feb 2009: Dow 7,114.78, -3.41%

Mountain View, CA (Global Understanding Institute)

Today was another bottom-bursting day for the U.S. stock market. The Dow Jones Industrial Average (DJIA:DJI) plunged 250.89 points, or 4.31%, to settle at 7,114.78. The last time the index closed this low was in 1997, over a decade ago.

The broader Standard & Poor’s 500 (SP500) was also down 26.72, or 3.47%, closing at 743.33. Both indexes are off by about 50% from their highs back in October 2007, and are back to levels of April-May 1997.

The NASDAQ index was also down 53.51, or 3.71%, closing at 1,387.72.

Dow Down and Chernin On the Way Out

Speaking of a falling of the value of the Dow, News Corp (NASDAQ:NWSA), the company that bought the venerable Dow Jones corporation for $5 billion in 2007, dropped $0.26, or 4.3%, to close at $5.78.

News Corp announced the planned departure of Peter F. Chernin, its #2 executive under Rupert Murdoch, when his contract comes due in June. Mr. Chernin, a Democrat, was known to have significant contentions with members of the Murdoch family, and with other executives in the Fox News division. This latest plunge brings News Corp down to about a quarter (25.53%) of the value its 52-week high of $22.64.

Stimulus in Time?

In an indirect reply to Republican Governor Jindal of Louisiana, Barack Obama spoke at the National Governors’ Association dinner about whether the stimulus was partisan pork (Jindal’s contention) or bipartisan recognition of necessity (Obama’s position).

You know, when I hear people say, “Well, there’s a lot of waste in this program,” well -- from my perspective at least, keeping teachers in the classroom is not wasteful; from my perspective, tax cuts to 95% of working families is not wasteful; from my perspective, providing all of you additional resources to rebuild roads and bridges and levees and dams that will enhance the quality of life of your state but also make it more economically competitive -- that’s not wasteful.

And so, if we agree on 90% of this stuff, and we’re spending all our time on television arguing about 1, 2, 3 percent of the spending in this thing, and somehow it’s being characterized in broad brush as wasteful spending, that starts sounding more like politics. And that’s what right now we don’t have time to do. ...

— President Barack Obama

U.S. popular sentiment is overwhelmingly on the President’s side at this time. And that time is limited. A Washington Post-ABC poll projects about two-thirds (64%) of Americans support the $787 billion stimulus bill.

Yet there is a sharp rise in concern about the Federal deficit. Overall, 59% of surveyed Americans in a Washington Post-ABC News poll described themselves as “very concerned” with the budget deficit, up 10 percentage points over when President Bush was in office. Under President Bush the U.S. debt grew from approximately $5 trillion to $10 trillion, the projected debt is presently at $10.85 trilion (as per the Brillig.com U.S. National Debt Clock). It is likely to rise to more than $12 trillion in 2009 through bailouts, the stimulus package, and a revenue shortfall due to the recession.

One looming question remains: whether the medicine of the stimulus package can be administered to the patient quick enough to prevent more castastrophic organ failure in the meanwhile. One dire scenario paints a default of the U.S. public debt by summer 2009. China has started to lose its appetite for U.S. dollars, and will have to afford its own $600 billion internal stimulus bill in 2009.

He also needs to, and has pledged to bring down the ballooning Federal deficit so that longer term massive budgetary hemmoraghing can be staunched. It is already at $1.3 trillion and may rise as high as $1.5 - $2 trillion in 2009. Plans released today by the Obama administration set goals of having the deficit to $533 billion by 2013.

In order to pull off this massive restructuring of the U.S. economy, indeed, the global economy, many things have to go right. It will take a combination of best faith efforts, cooperation, innovation, good governance, and the right amount of sheer luck for all the factors to fall into place.

ƒ((Think+Act)•(Local+National+Regional+Global))

The old “think global, act local” paradigm needs to be both local and global thinking and acting. If we just think about what is going on overseas, and we do not act upon it, it is the political equivalent of the mathematician who mentally solved for preparing a month’s worth of meals and starved to death because he left the implementation of the proof to others. We have to think local and act local. Plus, we have to think global and act upon such thoughts. We also need to think in scalable terms. “Local” can be defined as a neighborhood or village. Or a city, a county, or even a state. There are holistic paradigms beyond the nation as well: regions, alliances, continents. Where do we focus ourselves? Locally? Nationally? Internationally? The right answer is a Boolean “AND” statement.

This global crisis is unprecedented. Because we are mutually interdependent as national and regional economies we cannot just solve our issues at home, or foist them off on others abroad.

There are a few events coming up to deal with economic events, both on a local, national, and global basis:

Local:

• Puppy Love (Economic Recovery Meeting), Mountain View, CA, Saturday, 7 February, 12:00 - 6:00 pm, 551 Chiquita Avenue, Mountain View, CA
  
  
• Economic Recovery Potluck (Economic Recovery Meeting), Palo Alto, CA, Sunday, February 8 from 1:00 PM - 3:00 PM, 400 Miramonte Avenue, Palo Alto, CA 94306

International:

• Financing the United Nations: More Effective Funding for Global Priorities, 11 February 2009, 9:30 AM - 2:30 PM, Global Policy Forum, New York City
  
  
• Forum on the Solidarity Economy 2009: Building Another World, 19-22 March 2009, University of Massachusetts, Amherst
  
  
• LUX ’09 International Forum - Globalisation of Solidarity, 22-25 April 2009, Schifflange, Luxembourg
  
  
• World Economic Forum, various annual and special events

Strangely, I did not see much in terms of a California state focused economic summit or forum. Matters are definitely in grave state, yet there seems to be no present opportunity for the public to gather together to work on solutions for the state.

If you have more thoughts on the state of the economy in your area or around the world please share your thoughts. We can also use a “Economic Crisis” volunteer group to work more on collective information gathering, analysis and policy work. Please contact us if you would like to share your experience, knowledge, and ideas, and to become involved.

Peter Corless.
petercorless@mac.com
650-906-3134 (mobile)

Showdown at Davos

Where to start?

The World Economic Forum summit of global leaders held this week at Davos, Switzerland, has been the economic equivalent of the shootout at the OK Corral.


(Putin speaks out at Davos' opening; Source: RT; Time: 31:20)

• 28 January: Vladimir Putin began the gunslinging by delivering a keynote speech indirectly accusing the U.S. and China of steering the world into economic gridlock, and also took a backhanded swipe at the ineffectiveness of the international community containing international crises, and even directly contributing to them: “Frankly speaking, we all know that provoking military and political instability, regional and other conflicts is a helpful means of distracting the public from growing social and economic problems. Such attempts cannot be ruled out, unfortunately.” Carefully parsed, it ignored Russia’s own complicity in many global crises and instead proposed Russia as the solution the world is waiting for. Aside from the inherent propagandistic nature of a national leader speaking before assembled dignatories, his half-hour long speech was filled with many sound fundamental arguments: a depreciation or write-off of bad debts, a return to fundamental economic bases, and a recognition of global economic interdependence: “We should not despair. This crisis can and must be fought, also by pooling our intellectual, moral and material resources.” After his prepared speech, he also turned down a question of assistance from U.S. technology leader Michael Dell. Thus, much of his rhetoric could be described as a sort of political “slap and tickle.” Stingingly rebuking, yet enticing of the possibilities.
  
  
• 29 January: In comparison, Putin’s keynote was placid and friendly compared to the heated exchange between Turkish PM Recep Tayyip Erdogan and Israeli President Shimon Perez: Talking about Gaza, Erdogan excoriated a defensive and vocal Perez, accusing the Israeli leader by saying, “You kill people,” and walked off stage. Perez had spent 25 minutes defending Israel’s position, while Erdogan had only gotten 12 minutes in response. He left with an ominous rebuke of the moderators and organizers, “I will not come to Davos again.” Though afterwards, he took time to note that he has maintained a position that anti-Semetism is a crime against humanity, he was supported in his abandonment of the discussion by Arab League Secretary Amr Moussa, who said of the Israeli leadership, “They don’t listen.” Erdogan’s wife went further, saying “All Peres said was a lie. It was unacceptable.”
  
  
• 29 January 2009: Chinese Premier Wen Jiabao then verbally opened fire on the U.S. for leading the world down the primrose path into global recession. Not expressly naming his target, he spoke of “excessive expansion of institutions in blind pursuit of profit.” Besides the arresting headline quotes, the full text of his speech is revealing. Of course, China remained blameless in the international march of folly, even as it continues to use eminent domain to seize small farms and village houses to pave the way for giant state-run businesses, industrial plants and hydropower projects, often with little or no compensation. This was referred to obliquely by speaking of China’s plan to “push ahead comprehensive industrial restructuring and upgrading.” He neatly bypassed the issue of China fueling the financing crisis by being the primary beneficiary from buying up U.S. investments and securities, profiting greatly, and then dumping them, such as their withdrawal from Fannie Mae and Freddie Mac in 2008. The road to recovery included a stimulus package for China focused on helping for the rural and poor, investing in infrastructure and specifically mentioning earthquake protection. How much of this was said to reassure the global financial community, and how much was left to address the increasingly unhappy domestic audience of China remains an exercise for the audience. The other statement which could be taken as a staggering exaggeration of fact was this: “Steady and fast growth of China's economy is in itself an important contribution to global financial stability and world economic growth.” For it has been the rapid growth of China’s economy which has in many ways fueled food, resource, ecological and energy crises, and caused instability around the world. To alter the old axiom, “What is good for GM is good for America,” Wen Jiabao tried to argue in effect, “What is good for China is good for the world.” Maybe not so much. Lastly, his speech may have been more to paint a desired vision than an actual condition when he said, “There is harmony and stability in our society.” Again, maybe not so much.
  

This is not to utterly refute many of the good points each of the world leaders made in their various speeches, interviews and forums. There is a need to find harmony in the world. There is a need to create a more fundamentally sound economic equilibrium based in interdependence. Yet it seemed to many that something was lacking. Not least of which was the present U.S. President or a key representative of his new administration.

It behooves each world leader to admit their own nation’s contribution to the problem. Each can say many domestically-pleasing, often-too-safe and sage-sounding points, plinking their neighbors and rivals with rhetorical spitwads, and leave aside much of the trash in their own backyards. The harder work is in mapping a way past such parochialism.

It is all-too-easy to blame the West. Indeed, the U.S. is definitely culpable for much of the mess occurring in the world today. The EU as well. However, each nationstate on the planet is in its own way a contributor to and participant in the present crisis. In other ways, each is a necessary partner for the solutions.

What none of the global leaders seemed to be able to do was to offer a mea culpa, and accept responsibility for their part in the creation of the problem. The Chinese Premier described China specifically as a “responsible nation,” yet he meant that as a way to praise his regime’s leadership, not as an acceptance of its role in causing the present harm.

Of all the leaders, and even for all of his self-congratulatory praise of Russia, Vladimir Putin must be credited for being focused most on the future and the collective dialogue, rather than the insular defense of the status quo, celebration of past successes, or place in the present status.

The real question is which of the various world leaders in office today will step up to the role of key moderators of the global crisis. To gain the trust of others, they must be willing and capable of self-criticism, engendering in their peers the careful balance of spirit in admittance of fault, acceptance of error, while not lowering sights from an end-state goal.

Emergent powerhouse Brazil surely was not interested in such a role, with President Lula instead attending an “anti-capitalist jamboree.” The United States was pretty much sitting on the sidelines too, citing the transition of the new administration. The highest-level administration representative sent to the conference was Senior White House aide Valerie Jarrett.

The most upbeat of speakers featured in the headlines this week from Davos was former U.S. President Bill Clinton, who said:

“This financial crisis proves, as nothing else should or could, the fundamental fact that global interdependence is more important than anything else in the world today… We cannot escape each other. Divorce is not an option.

“This is not a time for denial or delay. Do something. Give people confidence by showing confidence… Don't give up. Don't bet against yourself. Don't bet against your country. This is still a good time to be alive.”

We can hope that, in due time, other presently-serving international leaders will echo similar sentiments, backed with cooperative international policies and plans providing a roadmap to the achievement of a new sustainable system of global economics.