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  • One thing is clear. Something is very wrong. W hether we are aware of it or not, the lifeblood of all of our established institutions, and thus society itself, is money.
  • The World is being taken over by a hand-full of business powers who dominate the natural resources we need to live, while controlling the money we need to obtain these resources. The end result will be world monopoly based not on human life but financial and corporate power. And, as the inequality grows, naturally, more and more people are becoming desperate.
  • : fiscal stimulus , monetary easing , liquidity injection , interbank loan guarantees

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  • Can we expect consequences from the current financial crisis on the international level Tomas Pranckevi čius IBDEM / ERASMUS June 30, 2009
  • What does mean the crisis?
    • “ The crisis is a crisis in consciousness. A crisis that cannot, any more, accept the old norms, the old patterns, the ancient traditions. And, considering what the world is now, with all the misery, conflict, destructive brutality, aggression, and so on… Man is still as he was. Is still brutal, violent, aggressive, acquisitive, competitive. And, he’s built a society along these lines.”
    • - J. Krishnamurti -
    Can we expect consequences from the current financial crisis on the international level
  • What is the most important financial dilemma?
    • In a world where 1% of the population owns 40% of the planets wealth.
    • In a world where 34.000 children die every single day from poverty and preventable diseases .
    • 50% of the world’s population lives on less than 2 dollars a day .
    • This global financial crisis at least 7 th in last 200 years . Economy and financial system are too much interactive.
    • T he concept of a resulting effect arising from financial crisis . I t is used to indicate that all human actions have profound effects on global economy.
    • The problem exist on the true value of the things. Virtual or material? How to measure?
    Can we expect consequences from the current financial crisis on the international level
  • By 2050 our world will be transformed… We should change our view how do we see things… We shouldn’t see things at national level… We must see things at a global level… This is not the question should we change? The answer is we must change! Can we expect consequences from the current financial crisis on the international level
  • Where we are acting now? Interaction and forces of reaction ..
    • The future is already here. It's just unevenly distributed.
          • - William Gibson -
    Can we expect consequences from the current financial crisis on the international level Reality
  • OECD GDP projections: annual change in percentage OECD Economic Outlook published on June 28th, 2009.
  • Some details…
    • Shipment felt in China 29,7% in April, 2009.
    • Export felt in Japan 40,9% in May, 2009.
    • South Korea invest to long run to Green Grow.
    • Earning less and spending less.
    • Developing countries have the largest impact on financial crisis.
    • Iceland GDP was only few milliards $ in 2003 ; In 2006 GDP increased to $ 140 milliards. After this bubble burst every Icelander young or old, even just born child have about $ 330 thousands debt today .
    Can we expect consequences from the current financial crisis on the international level
  • OECD Forecast in 2010..
    • Chinese GDP growth is forecast to be 8.5%.
    • Brazil, economic activity is forecast grow from 0.8% to 3.8%.
    • Russia economic activity is forecast to drop by 6.8% in 2009 and climb by 3.7% in 2010.
    • India growth is predicted to slow to 5.9% in 2009 before accelerating to 7.2% in 2010.
    • Euro zone output expect to be flat.
    • US GDP expect to grow 1%.
    • Japans GDP expect to grow 0.7%.
    Can we expect consequences from the current financial crisis on the international level
  • Can we expect consequences from the current financial crisis on the international level
  • “ Road to recovery” or Stronger economy
    • To review the necessary policies: financial and macroeconomic policy actions.
    • Urgent need to put public finances on a sustainable track .
    • How to avert an impending social crisis and how to meet development challenges.
    • Opportunity to kick-start a shift towards a cleaner economy and to support a sustainable and environmentally friendly growth.
    • Protectionism in trade and investment threatens to undermine economic recovery and long-term growth .
    • The speed at which financial conditions improve .
    Can we expect consequences from the current financial crisis on the international level
  • FREEDOM OF INVESTMENT
    • Strengthened peer monitoring : new investment protectionism
    • Enhancing public and private responsibility
    • The “Freedom of Investment” process
    Can we expect consequences from the current financial crisis on the international level
  • FOSTERING INNOVATION FOR SUSTAINABLE GROWTH
    • Fostering innovation
    • Encouraging business renewal
    • Investing in people and infrastructure
    • Greening the economy
    Can we expect consequences from the current financial crisis on the international level
  • KEEPING MARKETS OPEN: AVOIDING TRADE PROTECTIONISM DURING THE CRISIS
    • Governments should do everything in their power to ensure that trade finance is available in sufficient volume to keep trade flows moving, immediately and when recovery gets under way.
    Can we expect consequences from the current financial crisis on the international level
  • THE OUTLOOK FOR FOOD AND AGRICULTURE
    • How is agriculture faring in the economic crisis?
    • The role of biofuels
    • Beyond the crisis : Population and income projections suggest food production needs to increase 50% by 2030 and to double by 2050.
    Can we expect consequences from the current financial crisis on the international level
  • FINANCING SMEs DURING THE CRISIS
    • The double shock of the crisis: a sharp decline in sales and cut backs in credit by banks .
    • How are governments responding?
    • 1) Supporting sales, cashflows and working capital through tax-related measures ( e.g. cutting, deferring, refunding taxes, export credit lines, credit insurance, etc).
    • 2) Enhancing SME access to liquidity, mainly to credit through bank recapitalisation and creation or expansion of loan and credit guarantee.
    • 3) Helping SMEs maintain their investment levels and respond to a possible surge in demand in the near future, through investment grants and credits, accelerated depreciation, and R&D financing.
    Can we expect consequences from the current financial crisis on the international level
  • GREEN GROWTH AND ECONOMICS OF CLIMATE CHANGE MITIGATION
    • Tackling climate change should not be delayed
    • Ambitious mitigation goals should be achieved through a policy mix, with an emphasis on price-based instruments
    • The economic crisis opens up new opportunities: intelligent infrastructure, energy efficiency, alternative energy supply and “smart” grids, public transport, water supply and sanitation and pollution control.
    • We need to move now towards a green economy
    • Green innovation requires both R&D investments and getting the prices right
    • All countries and all sectors need to take action
    Can we expect consequences from the current financial crisis on the international level
  • Financial crisis and real economy feedback loop Can we expect consequences from the current financial crisis on the international level
  • Prioritization of key driving forces on the future of wholesale financial markets Can we expect consequences from the current financial crisis on the international level
  • Long-term scenarios for the future of the global financial system (I)
  • Long-term scenarios for the future of the global financial system (II)
    • Financial regionalism: Are the advanced economies
    • underestimating the risks of regionalization and the possibility of isolation in a world of rapidly shifting power? Prospects for meaningful collaboration between the three global economic blocs – the Eastern International Economic Community (EIEC), the US-led Democratic Trade Alliance (DTA) and the EU – seem bleaker than ever.
    • Re-engineered Western-centrism: Are global
    • regulators and politicians in danger of regulating only for the last crisis, revisiting the restructuring of the global financial system , less than a decade after Bretton Woods II, it may already be time for Bretton Woods III.
    Can we expect consequences from the current financial crisis on the international level
  • Long-term scenarios for the future of the global financial system (III)
    • Fragmented protectionism: Is the world too focused
    • on pure financial and economic risks to the detriment of other factors? Should we be paying more attention to a set of exogenous risks that could further compound the current financial turmoil, such as armed conflict, adverse weather events and pandemics, prices instability for energy, oil, gas?
    • Rebalanced multilateralism: Will it take yet another
    • crisis to force the advanced economies to comprehensively tackle systemic risk? If so, will it be the new players who drive solutions?
    Can we expect consequences from the current financial crisis on the international level
  • Reference:
    • The world economic forum. The Future of the Global Financial System : A Near-Term Outlook and Long-Term Scenarios .
    • Organization for economic co-operation and development. The Crisis and Beyond: Building a Stronger, Cleaner and Fairer World Economy
    Can we expect consequences from the current financial crisis on the international level
  • Questions Can we expect consequences from the current financial crisis on the international level