In effect, CCMP becomes the next evolution of G7 (G8 ex Russia), as G7 moves from 7 individual entities to one integrated one, at least as respects monetary policy.
This effort will require rethinking and new ways of conducting business by all parties. It will be based on an understanding that the way to succeed against Commulist economic policies is to focus on the collective inflation and growth aspects/effects of the “group” (U.S. and WEAST collectively), rather than country by country’s “individual” situation. This is based on the principle that when it comes to competing with Commulism “in the long run”, what’s good for the whole is better for the individual parts (countries).”
In support of the Analyst’s Feb. 5, 2008 proposed integrated U.S./WEAST CCMP theme, he then too notes the April 5, 2008 Reuters article titled:
“G7 Leaders May Demand Overhaul of Bank Model”
Excerpt:
“Some banks will have to adapt their business models under policy recommendations to be made to global financial leaders at the G7 meeting next week, Dutch central bank chief Nout Wellink said on Saturday…The Group of Seven industrialized powers meets in Washington on April 11 to discuss a regulatory response to an eight-month old credit crunch that is crimping global economic growth...which is part of the Financial Stability Forum that coordinates the G7 regulatory response…These underpinnings should be strengthened…recommendations to the G7 -- the United States, Japan, Germany, Britain, France, Italy and Canada -- will also look at how to improve transparency in financial markets…About a dozen leaders, brought together by Prime Minister Gordon Brown, issued a communique urging the International Monetary Fund to help develop an effective early warning system to guard against financial risks to the global economy.”
The gist of the Reuters article being an embryo move by the G7 and other U.S. allies to act in concert, rather than individually, with regards to all facets of finance, fiscal and monetary policy.
In summary, the new and growing complexities of the financial markets and linkage to economic success and failure, warrant a relationship overhaul - a completely different approach going forward from both the Fed and Treasury. In the future, their respective role is to not separately wait, see and "maybe” react. Rather, it will be taking a collaborative "front and center” role, and acting in concert to perform two integrally linked actions:
1) Ensure/Achieve Market Stabilization and 2) Deliver Punishment.
With that new theme a catalyst for desired action and results, the prospect for a similar credit or other major financial market crisis in the future is severely mitigated. In doing so, the resultant inertia toward an advanced or integrated monetary policy between the U.S. and WEAST will provide improved immunity against an ever more creeping economic cancer - Commulism.
And with that too comes an interesting irony. To think that Bear Stearns, a company in the process of arranging a "$1 billion access swap” with the Commulist Chinese Government (i.e. Citic), is the entity at the center of the firestorm that triggered the crisis which transformed these two separate, distinct and often dysfunctional unilateral government and/or quasi governmental entities now into a most potent integrated, bilateral Commulism fighting force.
Their “1 plus 1 equal 4” synergistic partnership coupled with its (Analyst recommended) unity theme and mission statement of “Stabilization and Punishment” provides a key underpinning of support to the U.S. and global economies to help remain a strong counter to Commulism.
Indeed, the common law partnership between the Fed and Treasury yields a couple that is "Perfect Together"; perfect to help bolster the U.S. economy and in doing so, U.S. national security too.
-----------------------------------------------------------------------------------------
Closing Thought:
Tomorrow, April 11, 2008, Treasury Secretary Paulson meets with the G7 Finance Ministers and Central Bank Governors in an important and timely meeting given the many swirling crisis in the financial markets and economy. The following is the announcement excerpt from the Treasury website, concluding with an Analyst recommendation to Mssrs. Paulson and Bernanke:
