Market truths

28 January 2010 By Hugo Dixon

The French president used his address in Davos to blast the untrammelled free market. While the economic crisis has certainly exposed deficiencies in financial capitalism, this is largely because market forces were too weak rather than too strong.

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Nicolas Sarkozy launched a broad criticism on the untrammelled operation of the free market in an address to the World Economic Forum at Davos on Jan. 27. The French president argued that market forces needed to be offset by corrective measures.

Sarkozy attacked marktomarket accounting practices. He also made a thinlyveiled attack on China's policy of keeping its currency low. He said the undervaluation of certain countries' currencies constituted "monetary dumping" and called for a new Bretton Woods system. He promised to push forward the idea of reforming the global finance in 2011, when France will chair both the G8 and the G20.

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