It's Time To Return To The Gold Standard...

...says Judy Shelton.

Her WSJ Op-Ed piece should be required reading for every attendee of the upcoming G-20 meeting, "Summit on Financial Markets and the World Economy". It should especially be read by the promoter of the summit, French President Nicolas Sarkozy, who displays no friendliness to gold at all.

After all, Shelton reminds us:

Ironically, it was French President Charles de Gaulle who best made the case in the 1960s [for a classic gold standard]. Worried that the U.S. would be tempted to abuse its role as key currency issuer by exporting domestic inflation, he called for the return to a classical international gold standard. "Gold," he observed, "has no nationality."

Bush Plans Summit of World Leaders Over Crisis

At the urging of French President Nicolas Sarkozy (His half-brother, Oliver Sarkozy, is a Managing Director and co-head of the Global Financial Services at The Carlyle Group), President Bush will plan to hold a summit of world leaders "to discuss the global response to the financial crisis and ideas to prevent such a crisis from recurring in the future and to preserve our free market system."

At this point in his administration, it is clear that Bush "preserving our free market system" is the equivalent of Hitler favoring national healthcare for Jews, just before shipping them to Auschwitz.

Sarkozy in particular has pressed for the economic summit to be held in New York City, where, he says, "everything started".

This should be quite the show.

The summit is likely to include the member states of the Group of Eight – the U.S., Japan, Germany, the U.K., France, Italy, Canada and Russia – as well some developing countries that haven't traditionally had a seat at the table, such as China, India, Brazil and South Korea. Saudi Arabia, South Africa, Switzerland and Australia also are being mentioned as possible invitees, according to WSJ.

France To Back Bank Loans, Offer Capital

France has earmarked a maximum 360 billion euros of funds to prop up the financial sector, guaranteeing new debt and pumping fresh capital into banks if necessary, President Nicolas Sarkozy said on Monday.

"The French state will not let any banking establishment go bankrupt," said Sarkozy.

Doesn't Sound Like GW Is Part Of the Greenie-Industrial Complex

GW must be drinking, again. You can tell because it's the only time the frat boy makes any sense.

The UK's Telegraph reports:

The American leader, who has been condemned throughout his presidency for failing to tackle climate change, ended a private meeting with the words: "Goodbye from the world's biggest polluter."

He then punched the air while grinning widely, as the rest of those present including Gordon Brown and Nicolas Sarkozy looked on in shock.

Good for George. There's now a tiny positive in his overall embarrassing presidency.

Quarles Goes Public With His Case for Allowing Private Equity to Buy Bank Stocks, Without Current Restrictions

Apparently the full court press is on. In addition to Bloomberg reports on the Carlyle Group talking to the Fed on "reforming" the restriction on limitations to the size of positions private equity funds can take in bank stocks, there's also an Op-Ed calling for the same.

Carlyle Group managing directors Oliver Sarkozy (half brother of French President Nicolas Sarkozy) and Randal Quarles are now aggressively promoting, very publicly, their reasons why private equity should be allowed to own major stakes in bank stocks.

While we have no problem with free markets being allowed to operate, as we asked in our earlier post, what's all this "dialogue" between the Fed and Carlyle Group and other private equity firms about? Only one sentence is required to remove the restrictions.

Further, Quarles continues to bring up the fact that public markets will not be able to provide the necessary funds the banking sector will need. Does this really mean that Quarles is angling to prevent public markets from investing at any new level that private equity funds will be allowed to invest at?

This has been an on going project for Quarles. His current argument is not any different from his argument during the luncheon I attended back in April.

See my report here.

See his recent WSJ Op-Ed piece here.

Note that the WSJ article identifies him as the former "under secretary of the Treasury for Domestic Finance in the Bush administration." More precisely, and importantly, he was the Treasury's coordinator to the President's Working Group on Financial Markets (aka, The Plunge Protection Team) But, of course, identifying him as such would add a new layer of mystery to the always mysterious operations of Carlyle.