The news at a glance
The financial crisis: World leaders convene; Wall Street: No bonuses for Goldman brass; Casinos: MGM Mirage chief bows out; Banking: Iceland reaches deposit deal; Legal affairs: Cuban charged with insider trading
The financial crisis: World leaders convene
Leaders of the world’s 20 leading economies met in Washington this week and pledged to take “whatever further actions are necessary to stabilize the financial system,” said Krishna Guha in the Financial Times. The member nations of the Group of 20 promised to avoid protectionist policies that could aggravate the downturn and to “move quickly on regulatory reform.” The G-20 scheduled a follow-up meeting for April, “a sign that this body, and not the narrower Group of Seven industrialized nations, will play the leading role during the crisis.”
The summit’s significance lies less in what attendees accomplished than in who they were, said The Washington Post in an editorial. For the first time, the industrialized powers of Western Europe, North America, and Japan invited rising economies such as China, Brazil, and India to participate in economic deliberations. They had little choice: Developing countries will generate whatever growth the world will see in 2009. “For the West, the delicate business of sharing more power with non-Western countries” is just beginning.
Wall Street: No bonuses for Goldman brass
Goldman Sachs CEO Lloyd Blankfein and his six top lieutenants said this week they would forgo bonuses this year, said Ben White in The New York Times. Accepting multimillion-dollar bonuses, a company spokesman said, would have been inappropriate for leaders of “an industry that’s associated with ongoing economic distress.” Big payouts would also have irked Congress. “The decision is likely to put heavy pressure on Goldman Sachs’ competitors to take similar action.” Blankfein was paid $68.5 million last year.
Casinos: MGM Mirage chief bows out
Terrence Lanni resigned this week from the CEO post at MGM Mirage, following a controversy over his academic credentials, said Keith Winstein and Tamara Audi in The Wall Street Journal. Lanni’s official biography says that he earned an MBA from the University of Southern California, a claim the school disputes. Lanni, “one of the gambling industry’s most powerful figures,” leaves as MGM Mirage is struggling to secure financing to build a new hotel-casino on the Las Vegas Strip.
Banking: Iceland reaches deposit deal
Iceland agreed this week to guarantee the funds of overseas depositors in its failed banks, said David Ibison in the Financial Times. The move is expected to clear the way for billions of dollars in loans from the International Monetary Fund. Reykjavik had been feuding with Britain and the Netherlands over savings deposits frozen when Iceland’s three leading banks collapsed in October. London even went so far as to invoke an anti-terrorist law to freeze the assets of collapsing Icelandic banks in the U.K., in a bid to protect British deposits.
Legal affairs: Cuban charged with insider trading
The Securities and Exchange Commission this week brought a civil insider-trading complaint against Dallas Mavericks owner Mark Cuban, said Kara Scannell in Wallstreetjournal.com. The SEC says Cuban, 50, sold his entire 6.3 percent stake in Canadian Internet-search firm Mamma.com after learning from that company’s CEO that the firm planned to sell additional stock that would have diluted his holdings. By selling, the SEC alleged, “Cuban avoided $750,000 in losses.” Cuban denied the charges.