DAVOS, Switzerland (AP) — The world’s foremost gathering of business and government leaders wrapped up a five-day meeting Sunday with widespread agreement that a fragile recovery is under way but no consensus on what’s going to spur job growth and prevent another global economic meltdown.
In a group of big egos and many power players attending the annual World Economic Forum, there was even some humility and a realization that overcoming the first global financial crisis is uncharted territory.
The gathering of some 2,500 VIPs in this Swiss alpine resort saw much spirited debate on whether more regulation is needed for the financial industry, how to boost sagging global unemployment, and finding ways to ensure the nascent recovery is kept on course through 2010.
The atmosphere of doom and gloom that pervaded last year’s forum, which took place at the height of the economic crisis, was replaced this year by a feeling of some satisfaction that a modest recovery is under way but uncertainty about the way forward and how banks should respond.
Continue reading Closing time
- Jan 31, 2010 10:32 AM — Dirk Mathison
By ten o’clock this Sunday morning, forum personnel were already pairing up to remove the metal security barriers that enclose the Congress Center, while across the street at the Hotel Belvedere others were rolling up large reams of white tarp. The conference was lumbering to a quiet conclusion, but there would be one final word on financial regulation and the banking system.
Recovery everywhere remains fragile and dependent on government stimulus monies in the absence of a robust return of private-sector demand. There are still plenty of potential trip wires to send the global economy tumbling into the feared double-dip recession—asset bubbles, commercial real estate, bad bank assets, carry trades unwinding, protectionism—but there was consensus that too-early exits from government stimulus programs were the greatest risk.
Continue reading A few blog highlights
- Jan 31, 2010 9:02 AM — Dirk Mathison
Silence on Google
Eric Schmidt, chairman and CEO of Google, addresses a panel in Davos on Friday. (Photo courtesy of the WEF)
Marketplace’s Stephen Beard has filed this report on the growing rift between China and the United States over the issue of censorship:
Clearly, the biggest issue to confront officials at this year’s gathering in Davos is the question of banking regulations in light of the economic downturn.
The second issue, and one that’s not receiving nearly as much attention (but to my mind is equally important), is the state of U.S. -China relations.
It was widely anticipated that Google’s recent threat to pull out of China over cyber attacks and aggressive Chinese censorship would take center stage this year. This is especially true given what many consider to be China’s pronounced swagger at the recent conference on global warming in Copenhagen.
In fact, the Google issue, which by any estimate is an enormously important topic, has barely surfaced in a formal WEF setting. Various reports say that the Chinese insisted to WEF officials that they would not discuss Google at Davos.
As of now, it appears that the chest-thumping has succeeded in tamping down the issue almost entirely. There was apparently no mention of Google at several forums where it would be an obvious topic. Panelists of “Rise of Asia” and “Redesigning the Global Dimensions of China’s Growth” said nothing about Google. Even Eric Schmidt, Google’s chairman and CEO, has tread lightly (and politely) on the subject.
“We like what China is doing in terms of growth,” Schmidt said during a WEF press conference on Friday. “We just don’t like censorship. We hope that will change and we can apply some pressure to make things better for the Chinese people.”
One would think that the man who, as his own bio proclaims, invented the World Wide Web, might have strong feelings about China’s censorship. I caught up with Tim Berners-Lee during a break in the proceedings. Berners-Lee expressed regret “that China jailed a blogger and that it is still censoring the Internet,” and said that he “hopes that China realizes that openness is necessary. And that they become progressively more open before big pressure for change builds.”
Yet when asked about Google and whether it should remain in China, Berners-Lee said, “I can’t comment on that.” He then turned on his heels and departed.
It’s easy to interpret the official silence on Google as a symbol of China’s growing power. But, according to some long-time Davos Men, it says more about the culture of Davos itself than it does about any desire to appease the Chinese. It is, by WEF standards, better to avoid flash points than to alienate any shareholders in a growing global community. Even issues that should be considered sacrosanct, including freedom of speech, are taken off the table for the sake of a healthy dialogue. Following an edict of Winston Churchill, Davos believes that it’s “better to jaw-jaw than to war-war.”
But the bedrock issues remain: will China’s growing prosperity move it toward a more democratized society, or simply bolster its power to repress free speech?
Texas CEO Kenneth Hersh, who runs a $9.3 billion private equity firm predicts that it is a dynamic that will, in his words, “play out over a generation. The next 50 years are going to be very interesting.”
—Stephen Beard in Davos
- Jan 30, 2010 12:03 PM — Dirk Mathison
Julia Lalla-Maharajh, founder of “End FGM Now” speaks at WEF panel on Saturday. (Photo courtesy of WEF)
In recent years, the WEF has offered YouTube users the chance to submit video essays directly to world leaders gathered at Davos. Subjects have included the fight against aging, world poverty and global warming.
This year, YouTube viewers voted to send Julia Lalla-Maharajh, a London-based advocacy adviser, to Davos to take part in a discussion on female genital mutilation. Her winning video, embedded below, contains a gut-wrenching description of FGM (including the amount of time that the procedure takes). But Lalla-Maharajh addresses the issue with intelligence and compassion. It’s easy to see why she was selected to speak at Davos.
Lalla-Maharajh addressed the conference earlier today and, in an interesting aside, she also encountered former president Bill Clinton in the halls of the WEF. She took the opportunity to tell Clinton about her cause. The interaction offers a good illustration of how work gets done at Davos.
Here’s the video that earned Lalla-Maharajh the right to speak at the WEF:
- Jan 30, 2010 10:08 AM — Dirk Mathison
Lawrence Summers speaks in Davos on Friday. (Photo courtesy of WEF)
DAVOS, Switzerland (AP) — Confronting bankers head on, President Barack Obama’s top economic adviser told them Friday to put their customers first and insisted the U.S. government would push through new banking reforms despite pressure from lobbyists. “Our challenge now is to put in place a new system,” said Lawrence H. Summers, telling a crowd at the World Economic Forum that the reforms wouldn’t last forever but should be able to protect a generation from banking excesses.
Summers, the top U.S. official in Davos this year, said there needed to be rules restraining how risky these banks can become. His session came after three days of complaints from senior officials in the banking industry that governments - and the U.S., in particular - risked choking off growth with a glut of new financial regulations.
The level of anxiety among financiers at the new populist push was reflected in a series of closed-door meetings at Davos on the subject of the regulation proposals, and bankers and financial regulators were expected to meet again Saturday on the forum’s sidelines to discuss a range of issues, officials said.
Summers was adamant that “we are going to put in place a set of reforms that will make a real difference.”
Continue reading Summers: reform is coming
- Jan 30, 2010 9:00 AM — Dirk Mathison
A busy 'wocial' life
Publisher Hubert Burda, right, talks to Roland Berger, left, and Josef Ackermann, CEO of Deutsche Bank AG, during the Burda DLD Nightcap 2010 party at the Bellvedere Hotel on Jan. 27, 2010 in Davos. (Photo: Alexander Hassenstein/Getty Images)
Saving the world is really hard work — just ask a punch-drunk Master of the Universe after a long day of handshaking and speechifying in Davos. So when the seminars are done for the day, many attendees head to bars or cafes for a little R&R.
Davos is famous for its party scene. A lucky few will be invited to parties in chateaus on the outskirts of town. Others will go to some of the more popular bars and restaurants such as the Cabanna Club or Bar Bistro.
There was some concern that a moribund economy and various global crises would put a dent in the social scene. Some of the usual heavy hitters, including Rupert Murdoch, have stayed away this year (as if he, of all people, would really liven up a soiree). But people always need to eat, drink, and flirt. Thus while the mood is more subdued than in previous years, the tradition continues.
As we write, the much-hyped Google party is in full swing. Although an invitation to the gathering is highly coveted, not everyone’s impressed. “It’s probably just a bunch of dorks standing around looking for free liquor,” said one bitter media type who did not receive an invitation.
One of the most prominent players in the Davos party circuit is Barry Colson, a Canadian performer who treks to the Alps each year to entertain the WEF masses at a piano bar in the Hotel Europe. Marketplace’s Christopher Werth caught up with Colson earlier this week. And today he had this story on the Marketplace show:
Kate Weinberg of London’s Telegraph describes Davos nightlife, where a distinct hybrid of work and socializing gets its own name:
“Davos is, after all, the highest form of “wocial”. For those who don’t know - or don’t have to go - the wocial is an event that is part work, part social. It is the brunch of the business world. People are casual, but nobody is entirely relaxed. There is drink, but it’s unwise to get drunk. Conversations may be informal, but they are supposed to be important.
“The hierarchy of wocials in Davos is tangible. Every evening a certain buzz travels through the frosty air, similar to that in a music festival, about which is the best gig in town. Private rooms in restaurants are taken over by companies and campaigners who, intent on luring investors and good press, throw red wine and rosti at the problem.”
“Wocial,” at least to this observer, sounds a lot like “Mwork.” As in just “more work.”
- Jan 29, 2010 2:00 PM — Dirk Mathison
Marketplace’s Christopher Werth walked into a press conference in Davos only to be suddenly ushered back outside through the snow and into a simulation of a refugee camp; to his surprise, he became a willing participant in a bit of street theater enacted by the United Nations Commission on Human Rights to bring awareness to the plight of refugees and internally displaced people. For the next 20 minutes, he and a group of ten other WEF attendees (including economist Jeffrey Sachs ) were corralled by armed soldiers. Still wobbly from the experience, Werth filed this dispatch shortly after his “release”:
(Photo: Christopher Werth / Marketplace)
Our guide led us through the snow and down a hill towards a makeshift shack that was decorated to look like a home in Afghanistan, with rugs and pillows on the floor. The women were made to wear head scarves. With a single knock at the door, a group of men and women playing the part of town locals pulled everyone in, screaming “the rebels have stormed the city.”
Suddenly, the room went black, as soldiers armed with machine guns and flashlights burst into the room, yelling “get down, get down” and pushing us to the floor. Then we were forced through a maze of rooms, and made to empty our pockets at the gate of a barbed wire enclosure.
The feeling was incredibly tense. Even when you know it’s a simulation, the constant screaming and disorientation of the lights going on off gets to you. After 20 minutes, it was all over. But I admit to be shaken and disoriented.
That’s exactly the intention of the UNCHR, which hopes to influence some of the policy makers in Davos this week and to bring attention to the plight of 42 million internally displaced people around the world.
It appears to be working, at least in my small group. ”Even in a few minutes of being pulled into a world of violence, rebels, land mines, shots in the night—and of course this is the reality for so many people—it triggers lots of emotions,” Jeffrey Sachs told me after the simulation. “It’s an extraordinary experience.”
Lord Malloch Brown takes part in the Refugee Run, which the former UN deputy secretary-general described as “compelling.” (Photo copyright of Global Hand UK)
Sachs went on to describe a possible solution to the plight of refugees, at least for some. “Sustainable development is a path to peace,” he said. “A lot of the violence in the world results from places of hunger, places experiencing extreme deprivation, they are the most prone areas to dislocation, and if we can help people to find a foothold in the world that gives education for children, and access to food and water, we’ll avoid a lot of these tragedies.”
—Christopher Werth in Davos
At the press conference mentioned above, Sachs also called on the United States, Europe and other nations and international organizations to set up a relief and development fund for earthquake-ravaged Haiti:
- Jan 29, 2010 1:35 PM — Dirk Mathison
The man behind the curtain
Matthew Stinchcomb of Etsy.com, a website that markets handmade goods, shared some humorous Davos moments he had in meeting Bill Clinton and South Korea’s President Lee Myung-Bak:
- Jan 29, 2010 10:05 AM — Dirk Mathison
Terrorist monetary policy
It seems that everyone, including fugitive terrorist masterminds, wants a place at the table in Davos.
According to the WSJ, Osama bin Laden has added his voice to the mix by releasing a statement that’s clearly intended to coincide with the WEF gathering.
In an audio tape sent today to Al Jazeera Television, bin Laden urges his minions to move away from the Dollar and to “get rid of this currency as early as possible.” According to the WSJ, Bin Laden also blames the west for global warming.
In a snarky aside, the WSJ points out that bin Laden’s rant was similar in theme to the WEF talk given by French President Nicholas Sarkozy two days ago.
- Jan 29, 2010 8:19 AM — Dirk Mathison
Bill and Melinda Gates announce $10 billion vaccine funding at the WEF conference in Davos on Friday. (photo courtesy of WEF)
(AP) The Bill and Melinda Gates Foundation will donate $10 billion over the next decade to research new vaccines and bring them to the world’s poorest countries, the Microsoft co-founder and his wife said Friday.
Calling upon governments and business to also contribute, they said the money will produce higher immunization rates and aims to make sure that 90 percent of children are immunized against dangerous diseases such as diarrhea and pneumonia in poorer nations.
“We must make this the decade of vaccines,” Bill Gates said in a statement. “Vaccines already save and improve millions of lives in developing countries. Innovation will make it possible to save more children than ever before.”
Continue reading $10 billion for vaccines
- Jan 29, 2010 6:56 AM — Dirk Mathison
Marketplace’s Dirk Mathison is posting items and updates on the World Economic Forum's 40th annual meeting. The conference runs from Jan. 27-31. Reporters Stephen Beard and Christopher Werth are contributing additional items from Davos.
- Closing time
- A few blog highlights
- Silence on Google
- '44 minutes'
- Summers: reform is coming
- A busy 'wocial' life
- Displaced person
- The man behind the curtain
- Terrorist monetary policy
- $10 billion for vaccines
- Clinton: Obama right on Bernanke
- The Caribbean Alps?
- Signs of contrition?
- 'A u-shaped dynamic'
- A plea for Haiti
- Sarkozy goes on offense
- First impressions
- A (slight) breach in protocol
- Davos piano man
- What about the robots?