Preaching caution

With the G20 convening this weekend caution is still being preached in response to the financial crisis

This week saw Jon Moulton quit as head of Alchemy Partners, a shake-up of the narrative of private equity. It followed an embattled argument between Moulton and Dominic Slade, head of Alchemy's buyout arm, over the group's strategy. "Alchemy is not what it was," Moulton said in a letter to Alchemy's investors. "Dominic Slade now wishes to convert the firm into a specialist financial services firm. I do not support this strategy. It's contrary to the positioning we have created with investors and deal sources, and wastes a spectacular opportunity in our area of perceived greatest strength." While coming as a surprise move to some, signs of tension had been bubbling for a while now - in a recent interview, Moulton warned "One day we'll wake up and discover that no foreigner will buy gilts – and we've had it". It's not quite that day just yet but he's jumped ship at a sensible time…

The G20 policymakers are meeting in London this coming weekend, and it's once again all doom and gloom. While uniformity is some way away, Brown, Sarkozy and Merkel all agreed that a cautious approach must be taken to avoid new global imbalances. They also acknowledged financial uncertainty and prudence as values affecting public perception, and promised binding measure to curb bank-workers' bonuses. President of the European Central Bank Jean-Claude Trichet, meanwhile, warned of "a bumpy road ahead"; this came as interest rates were left unchanged at 1 percent for the fourth consecutive month.  President Jean-Claude Trichet told a news conference, "today is no time to exit", bolstering talk of the ECB not raising rates until Q3 next year.



Something world leaders also have reached consensus on, at least in outline form, is the fact that emergency support ought to start being withdrawn. The US, UK, France and Germany talked of the co-ordination of "exit strategies" which will be triggered "as soon as the crisis is over". As much as they stand together on this, it's unlikely there will be a point in time where said exit strategies are implemented across the board; the OECD warned that the UK will emerge from the recession last among the world's advanced economies. The OECD predicted the UK would not see any growth until 2010, some six months, at best, after the rest of the pack.