Outrunning the avalanche -- Credit crisis looms large over annual Davos summit

Marketwatch ^ | Last update: 5:30 p.m. EST Jan. 18, 2008 | William L. Watts, MarketWatch

[Ernest_at_the_Beach]

LONDON (MarketWatch) - With the world's financial markets teetering on the brink of panic, the world's most powerful executives, financiers and politicians will be searching for answers to the global credit meltdown when they gather for their annual retreat next week in the Swiss Alps.

The annual meeting of the World Economic Forum in Davos isn't designed to produce detailed policy proposals, but participants say it will provide a platform to take a look at what went wrong. And front and center will be a look at how the practice of selling mortgages to home buyers and then re-packaging them and selling them as securities to other institutions got so out of hand on a global scale.

"I think there will be a high level debate on whether the 'originate and distribute' model now prevalent in financial markets is sustainable," said Howard Davies, director of the London School of Economics and Political Science. "That's the high-level politico-economic question."

"High-level" discussions of the world's problems are Davos' stock in trade. A Thursday session on systemic risks features both U.S. Treasury Secretary Henry Paulson and European Central Bank President Jean Claude Trichet.

Other notables from the world of finance include Goldman Sachs Group Chief Executive Lloyd Blankfein, private-equity honcho Stephen A. Schwarzman of Blackstone Group,

and hedge-fund titan George Soros.

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And some executives from banks at the heart of the subprime problem are also expected to be on hand, including new Merrill Lynch Chief Executive John Thain.

[neodad]

I’m sure John F. Kerry will be there. He likes Davos and is at home with the company.

[Perdogg]

Is this conference that all of the members of CFR go to plan the fate of mankind?

[Brian S. Fitzgerald]

I pray to God we don’t get Hillary as President in the middle of a major world financial crisis.

[Ernest_at_the_Beach]

Probably wants a private moment with Moveon.Org funder ...George Soros,.....

[Ernest_at_the_Beach]

Depends on how many stay home next November.

[AU72]

Won’t Carbon Credits save the day?

[advance_copy]

PANIC: When you and your friends have been running a multi-trillion dollar con job for decades and realize you are about to get caught.

[ikka]

What will work? Lower taxes, accelerated depreciation schedules that are more in line with reality. Maybe an R&D tax credit.

[CRBDeuce]

Reinstate ‘Uptick Rule’

[VxH]

>>What will work?

The crisis is primarily due to the current inability of financial institutions to trust one another. That needs to get fixed - beginning with the incarceration of those who who have broken the law and can not be trusted.

Falsify FICO scores, go to jail - it's pretty simple.

If I were an SEC regulator, I'd be carefully comparing the FICO scores returned by credit agencies against the scores on subprime loan docs.

[the invisib1e hand]

Reinstate ‘Uptick Rule’

right. that and a 35$ gold peg will solve everything, right?

[the invisib1e hand]

I pray to God we don’t get Hillary as President in the middle of a major world financial crisis.

perfect opportunity for an advance of socializm. maybe even dictatorship.

[AnimalLover]

bttt