50 Italian parliamentarians call for global summit for "a new financial architecture"

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Thursday, March 17, 2005

Italian parliamentarians call for global summit

A letter and motion to be debated by Italian Parliament this week calls for action to address speculative bubbles and potential future financial crashes in the global economy. The motion asks for a global summit similar to the 1944 Bretton Woods United Nations Monetary and Financial Conference, which gave us the IMF and World Bank.

The letter raises questions about the sustainability of current financial trends, based on the highly speculative nature of today's markets. For example, according to the letter, "It is estimated that the entire financial bubble, counting all financial derivatives and all other forms of existing debt, is equal to about $400 trillion, compared to a worldwide GDP of slightly more than $40 trillion".

Last years collapse of Italian dairy company Parmalat, with "14.3 billion euros that must still be accounted for", is given as evidence for "a lack of effective tools and controls regarding financial operations". Enron, which famously collapsed in November 2001 revealing faudulent accounting practices from previously respected accounting firm Arthur Andersen, is given as another example.

Oddly, the largest collapse on record, that of WorldCom, is not mentioned, though the set of examples is not purported to be exhaustive. A number of other crashes are mentioned: the LTCM fund, Argentine bonds, Cirio, and Finmatica.

The motion, linked to supporters of the Lyndon LaRouche movement, is signed by Parliamentarians Lettieri, Soro, Delbono, Tolotti, Widmann, Villani Miglietta, Rosato, Albertini, Morgando, Diana, Luigi Pepe, Damiani, Ostillio, De Brasi, Maccanico, Carbonella, Paola Mariani, Grandi, Pistone, Giovanni Bianchi, Giacco, Benvenuto, Piscitello, Camo, Realacci, Squeglia, Rocchi, Iannuzzi, Intini, Meduri, Santino Adamo Loddo, Boccia, Villari, Chianale, Siniscalchi, Sandi, Cusumano, Cennamo, Annunziata, Rotundo, Bonito, Buemi, Pennacchi, Fanfani, Tarantino, Rodeghiero, Angioni, Detomas, and Nesi.

Debate was scheduled for March 14-18.

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