The BBC is reporting a story titled “Bank insurance levy gaining support at Davos“, noting that politicians and bankers have supported the idea for an insurance fund that would bail out banks instead of taxpayers.
The recent earthquake in Haiti is a disaster of epic proportions. It is a humanitarian disaster with an estimated 200,000 dead. It has also caused a catastrophic collapse in confidence in the Haitians’ ability to repay their debts. Haiti is now an insolvent sovereign, by way of natural disaster.
Forex Blog has an article by Adam Kritzer entitled Fears of Sovereign Debt Default Enter the Forex Fray. Adam’s article focuses on Government debt as a percentage of GDP, and in particular contrasts the high debt as a percentage of GDP for the developed states with that of the fiscally conservative developing nations (which developing nations, one might say, have already learned their lessons on debt).
The BBC has an article about requests by China to switch from the single-currency reserve system to a an IMF-backed reserve system.
The suggestion made by China is to move to a Special Drawing Rights (SDR) (IMF factsheet) unit of account. SDR’s are backed by a basket of currencies, predominantly the U.S. dollar at present (44% according to Wikipedia).