Davos 2011: Follow Live UPDATES From the World Economic Forum's Annual Gathering
Amid high unemployment and concerns over a mounting sovereign debt crisis, some of the world's top leaders, thinkers and business titans are gathering once again in Davos, Switzerland for the World Economic Forum's annual meeting. We'll be compiling the latest updates from the Davos meetings here, including the best tweets, video, news from the conference and blog posts. Check back here regularly for updates from the event which runs from Jan. 26 - 30.
After blowing the lid off the plight of Davos wives, author Anya Schiffrin has some helpful tips for surviving the sometimes-perplexing goings-on at the World Economic Forum.
First, some sleigh ride etiquette. From Reuters:
I did notice, however, that after ranting about the Republicans and the Iraq War on the way to the cheese fondue lunch, no one wanted to sit with me on the way back. Oh well. It meant I had the yummy fur-lined blanket all to myself.
And some packing tips, ranging from the practical...
A flashlight for finding my way up snowy hills when searching for my hotel in the dark of night. The main streets are lit but we don’t qualify for a hotel on the main drag. Those are saved for the really important people.
...to the even more practical:
A cell phone that works internationally so I can text message friends to rendezvous at the comfy couches in the Congress Centre and let the folks back home know which VIP is picking his nose during the Saturday night concert.Read the whole piece here.
-- William Alden
Felix Salmon, making the party rounds at Davos, zeroes in on the Davos Tasting put on by the Wine Forum. The party was, in Salmon's words "basically a drunken mess" with a bill that "kept on rising from its initial stratospheric level, as [one of the hosts] insisted that if he was going to throw a party, the wine must never run out and must be available in quantity." But the underlying issue, as Salmon sees it, is more significant than a sloppy, expensive party:
I’m glad that I got the opportunity to taste a bunch of these wines, even though I didn’t really appreciate most of them. Maybe to do that you need to have much more respect for point ratings or dollar prices than I do, or at least believe on a very deep level that they have a strong correlation with quality. I’m pretty certain, at this point, that my taste in wine isn’t Robert Parker’s taste, at least as it is revealed in his ratings. But ultimately events like this aren’t much about taste at all: they’re about putting down markers of various kinds and confirming in the plutocrats’ minds just
how exclusive they, and Davos, really are.
Read the rest of Salmon's post here, including a list of which wines were offered.
The U.S. needs smarter spending to climb out of the economic recession, says Nobel Prize-winning economist Joseph Stiglitz.
"The real problem is the way we're spending money not the amount we're spending," he told told CNBC in an interview at Davos. "What we really need to do is actually increase our spending on investments ... and cut back our spending on weapons that don't work against enemies that don't exist, wars that we're going to lose in any case" Stiglitz said."Let's focus on strengthening our economy."
Stiglitz's plan is to spend on investments that will stimulate growth -- a could begin to reduce the deficit.
Speaking alongside Rob Johnson, Director of the Project on Global Finance at the Roosevelt Institute, Stiglitz told CNBC that, instead of more quantitative easing, the U.S. needs fiscal stimulus. Stiglitz, who's also Columbia economics professor, added out that when the 2 percent payroll tax expires in December, disposable incomes will decrease.
Last year, the Fed's $600 billion quantitative easing program, new U.S. debt, was criticized by foreign leaders as potentially damaging to the world economy. German finance minister, Wolfgang Schaeuble called it "clueless."
Defending his allegiance to Keynesian economics, which backs spending during times of crisis, Stiglitz told CNBC that over the long run, the economic discipline backed fiscal order. "Keynesian economics does not say you do not deal with the deficit," Stiglitz said.
When one out of six Americans who wants a job doesn't have one, he said, "Those are times in which you have to stimulate the economy, and what matters is the quality of the spending."
Speaking about the Eurozone debt crisis, Stiglitz told CNBC the Euro was not under threat. "I think there's going to be a lot of instability in Europe. The fact is that a weak euro is good for Germany and other parts of Europe that export. It's bad for the United States," he said. -- Yepoka Yeebo
At Davos, Treasury chief Tim Geithner reiterated his belief that the the U.S. economy is on the mend -- just don't expect a rousing recovery.
Here's the AP:
DAVOS, Switzerland — U.S. Treasury Secretary Timothy Geithner said Friday that his country has more confidence now that there is a sustainable expansion – but added that it is not a boom.
"There's much more confidence now that we've got a sustainable expansion," he said at the World Economic Forum, but added, "It's not a boom."
Citing six quarters of growth in the world's biggest economy, Geithner said the back of the financial crisis had been broken and that a recovery was under way, even though the jobless rate has been stubbornly high in the range of 10 percent.
"Unemployment only starts to fall when you see economies grow again. We're only a year-and-a-half into positive growth. As the economy continues this process of recovery, you'll see more people put back to work."
Read the full piece here.
Innovation is alive--CERN's Rolf Heuer returns from "The Science Agenda in 2011" with a renewed faith in the state of the modern sciences.
His message: innovation cannot choose between basic and applied research:
Innovation depends on a broad based approach to science, with constant interplay between the applied and basic ends of the spectrum.All of the panelists reinforced this message in different ways. Medical research, for example, without basic research in the life sciences would soon reach a dead end.
And, his surprising discovery that even the private sector believes in the necessity of global collaboration:
No single organization can assure the complete innovation chain from basic science to end product was the conclusion we drew. A piecemeal approach to science won’t work: only strong coordination between public and private sectors can deliver the scientific results we all strive to achieve.
Read more here.
From the AP:
In a panel discussion at Davos, where some 2,500 business leaders and politicans are gathered, U.N. climate chief Christiana Figueres said China "is going to leave us all in the dust" in the transition toward a more energy-efficient global economy.The Chinese, she said, "are not doing it just because they want to save the planet. They are doing it because it's good for the economy."
The message: the U.S. will have to think green to stay ahead in the global economy:
European Union Climate Commissioner Connie Hedegaard said it's time that American businesses realize that "it's bad business to not be among the front-runners" in that race."The solutions have to come from business. They will have to come up with alternative ways of doing things," she said
Read the full article here.
Amidst the titillating swarm of networking engulfing Davos 2011, Apple is spreading their gospel--for free.
The unofficial gadget of choice for world economic somebodies is that slab of technojoy we call the iPad.
The New York Times's Dealbook recounts:
The iPad has not yet banished the ubiquitous BlackBerry. But it received an ostentatious Davos product placement (unpaid, one would assume) on Wednesday night when President Dmitri A. Medvedev of Russia whipped one out during the question-and-answer session that followed his keynote address.
Read more here.
Besides contemplating world-wide high unemployment and the mounting debt crisis, those gathered in at the Swiss ski resort have another problem to consider: dressing for the snow.
The Wall Street Journal raises the issue delicately:
The world's business leaders appear to have spent very little time worrying about what to wear.
Some of us are wasting hours a day changing from snow boots or green rubber boots to more elegant shoes and back again, in order to rush through Davos's snowy streets from a meeting in one hotel to lunch at another.
As Davos is held at a ski resort, it's hard to imagine that snowy conditions were entirely unanticipated. Nevertheless. The Journal continues:
there are interesting nuances to be detected in the choice of footwear. The more conservative, or perhaps the more aesthetically inclined, have donned short but sturdy boots which, when worn with a suit, could pass for shoes unless subjected to close examination. Others are shameless, ordaring, pairing formal suits with robust hiking boots or shiny running shoes.
-- Lila Shapiro
The Internet is a content machine.
But does the world have too little unique content?
That's what Jeff Jarvis takes away from Davos 2011, seizing on an automated content-creating technologies Phillip Parker is creating to "to fill in knowledge that is missing in the world, especially in smaller cultures and languages."
We have our fill of news aggregates spitting out autocontent, but what if those same technologies can help us create a better network of information?
I'm fascinated by what Parker's project says about our attitudes toward content: that we in the West think there's too much of it (we're overloaded); that content is that which content creators create; that content has to be owned; that it has to be inefficient and expensive to be good and useful.
Read more here.
When Fareed Zakaria asked him a question at a Davos panel, he lashed out. From Reuters:
"Not all banks are the same and I just think that this constant refrain 'bankers, bankers, bankers' is just unproductive and unfair. People should just stop doing that."
At one point he was nearly shouting, according to the Wall Street Journal:
“J.P. Morgan bought Bear Stearns because the United States government asked us to!"
-- William Alden
"The point about Davos is that it makes everyone feel wildly insecure. Billionaires and heads of state alike are all convinced that they have been given the worst hotel rooms, put on the least interesting panels and excluded from the most important events/most interesting private dinners. The genius of World Economic Founder Klaus Schwab is that he has been able to persuade hundreds of accomplished businessmen to pay thousands of dollars to attend an event which is largely based on mass humiliation and paranoia.
Wives feel sympathetic to their husbands and share their pain. But we have our own problems to cope with. After all, we are the on the bottom rung of the Davos ladder."
And the toll it takes on mistresses:
But if wives have it bad, mistresses, who are invited under a variety of guises and usually wind up with a white name tag, have it worse. Typically their men are swallowed up by a tsunami of meetings and interviews and don’t have the time or inclination to take their mistresses around with them. Often these men go to high-level dinners to which wives and mistresses are not invited. The skinny and beautifully dressed Davos Mistress typically hangs around the auditoriums waiting for a couple of minutes with her man. While waiting, she keeps her eyes peeled looking to search and destroy the competition.
Read the full piece here.
DAVOS, Switzerland (AP) -- A small blast shattered two windows but caused no injuries at a hotel near where top business and political leaders are attending the World Economic Forum, Swiss police said Thursday.
The explosion happened in a storage room of the Posthotel Morosani shortly after 9 a.m. local time (0800 GMT) Thursday, regional police spokesman Thomas Hobi told the AP. He said federal prosecutors are investigating whether the blast has a criminal origin.
The Forum said in a statement a firework in the back of the hotel was to blame. The hotel did not comment.
The hotel is just over a mile (around 2 kilometers) from the main venue of the annual gathering in the Alpine ski resort of Davos.
There was little disruption to the hotel afterward and its activities beyond an increased security presence at the hotel's entrance. Guests, journalists and others were going inside.
A Forum-related lunch focusing on organized crime, called "Criminals Without Borders" went on as scheduled at the hotel at noon, with speakers including Colombian President Juan Manuel Santos and Robert Wainwright, the director of Europol, or European Police.
There is tight security at the World Economic Forum as left-wing groups plan to hold a protest this weekend against the annual meeting of political and business leaders and social activists.
Anonymous flyers circulated at a demonstration last week in the northeastern Swiss town of St. Gallen urged activist to "Smash (the) WEF."
The flyer says: "Let us fight together against the unbearable propaganda of capitalism."
In previous years violent activists have stayed away from the chic ski resort and staged violent demonstrations elsewhere in Switzerland instead.
How is Davos making the world a better place? By sparing business chiefs some travel time.
From the Wall Street Journal:
James Quigley, CEO of Deloitte, said the meetings he has in Davos would take 50 days if he traveled to all the different cities where his clients are based instead.
The world’s most powerful figures in business and policy have turned their attention toward the less powerful.
Min Zhu, special advisor for the International Monetary Fund, pointed to economic inequality as a crucial problem, criticizing the system that fosters it. From the Telegraph:
“The increase in inequality is the most serious challenge for the world,” he said. “If you ask anyone in emerging markets what they aspire to, they would say the U.S. model -- big car, big house, pension plan. But it doesn’t work.”
Inequality is becoming a theme at Davos. Earlier, Sir Martin Sorrell, chief executive of media giant WPP, said, “the concentration of wealth is a serious issue.”
“Wealthy people invest in financial assets, creating asset bubbles,” he continued, presumably not singling out anyone in particular. -- William Alden
Medvedev speaks! The Russian president delivered a sweeping keynote on the opening day of the World Economic Forum.
Beginning with a moment of silence for the Moscow bombing that killed 35 on Monday, Medvedev assured the crowd that Russia remained defiant in the face of terrorism.
"They expected their act would bring Russia to its knees. They expected their act would put us on the defensive. They expected and hoped the president of Russia would not come here, among other things of course," he said.
He also called on the International Monetary Fund to include the BRIC countries--Brazil, Russia, India and China--in their basket of main currencies.
But perhaps most surprising was Medvedev's defense of WikiLeaks--especially surprising considering the portrait of corruption the leaked diplomatic cables paint of the country.
"Despite the fact that in itself those were probably illegal activities in the view of some states, the effect of this affair appears to me very, very positive for international relations," he said, adding that, "Russia will not support initiatives that put in doubt freedom in the Internet, freedom which is based on the requirements of morality and law."Watch the full speech here. -- Amy Lee
At the top of NYU economics professor Nouriel Roubini's -- AKA Dr. Doom -- list of concerns this week is a forthcoming train wreck if the United States doesn't address the budget deficit.
"We're not doing much about the budget deficit." Roubini told Tom Keene on Bloomberg TV in a brief conversation at Davos concerning the global economy and U.S. fiscal policy. "In the United States the fiscal problem is very serious. The bond vigilantes have not yet woken up in the United States in the way they've done in the Eurozone. But unless the U.S. starts to address this fiscal problem, we're going to see a train-wreck."
The rest of Roubini's to-do list for Davos boils down to "the question of international policy cooperation."
"Many of the global problems are global, but policies are national," Roubini said. He added that there were "disagreements on fundamental long term issues: trade, climate change, financial stability," that must be worked out."
HuffPost's Ryan McCarthy has some humorous and very serious suggestions for getting actual things done at Davos this year, including:
Russian President Dmitry Medvedev, slated to be the conference's opening speaker, would realize that his country can't use Davos to solicit private investment shortly after imprisoning a billionaire in a trial widely viewed as a sham. Many Davos attendees would be dumbstruck upon their first introduction to the concept of "hypocrisy."
Read the full post here.
Joining Bono, JPMorgan chief executive Jamie Dimon and Russian President Dmitry Medvedev at the World Economic Forum's annual gathering in Davos, Switzerland will cost you at least $150,000, according the NYT's Andrew Ross Sorkin.
First you have to be invited to join the World Economic Forum. Basic memberships start at $52,000 but that only gets you into general sessions. "Industry Associate" members at $137,000, get past the velvet rope and into private sessions. Then you need a $19,000 ticket.
Exclusive of flight costs (first class, of course,), the NYT found one executive spending $140,000 for a 5-bedroom chalet for himself and his staff. Then there's the cost of getting around: $10,000 for a car and driver for the week. Dinners can run at around $210 a head, and peer-impressing cocktail parties will cost you $8000 an hour for 80 people.
That's one costly business expense.
More women are attending Davos than ever before -- but the number still falls dramatically short of where it should be.
In 2011, the number of female attendees will approach 20 percent, but according to Bloomberg, 30 percent is the base number that must be hit to integrate women's points of view into a discussion. Bloomberg lays out the numbers:
The female quotient at what the WEF website bills as an “unrivaled platform to shape the global agenda” may be close to 20 percent this year, up from 16 percent last year, because of a new policy to attract more women executives.That’s still not 30 percent, the level social scientists have found integrates women’s points of view into discussions, says Marie Wilson, author of “Closing the Leadership Gap: Why Women Can and Must Help Run the World” and founder of the White House Project for woman
Part of the slight improvement in female attendance is due to the World Economic Forum's new quota for female executives from major sponsors at Davos. The Wall Street Journal reports on the quota:
A spokesman for the WEF said, as a membership organization, there was a limited amount that could be done to improve female representation in corporate boardrooms and governments. She said the quota was seen as a way to nudge members in the right direction.
In 2009, Businessweek raised some excellent points in "Davos 2009: Where Are the Women?" :
The absence of an equal balance of women to men in the WEF's own leadership structure (which plans the topics that will be discussed at Davos and makes the ultimate decision about whom to invite) suggests that the organization itself has not caught up with the 21st century.
What the WEF may be missing (apart from several hundred to 1,000 women participants) is that the economic opportunity represented by women is one sure way that we can dig ourselves out of this economic crisis. Shouldn't that be on the agenda?
-- Lila Shapiro
Like any self-respecting Davos attendee, Russia's President Dmitry Medvedev is hoping the trip will pay for itself.
Even as a top aide recently admitted that the controversial trial and conviction of oil tycoon Mikhail Khodorkovsky will mean Russian will face "serious questions," Medvedev hoping to attract the attention of investors at Davos, the AFP reports.
The aide added that "Russia's investment climate is very bad." Following a trip to Silicon Valley last year, Medvedev has made improving Russia's standing in the business community a top priority.
Medvedev is headlining the conference this year and will take questions via Twitter, the AP reports. Last year, Medvedev and California governor joked via Twitter that they'd hit the ski slopes together.
Follow Medvedev on Twitter here. -- Ryan McCarthy
This year, the annual meeting of world elites in Davos, Switzerland will have a decidely somber tone. As attendees begin their familiar trek to the small Swiss town of Davos, the adgenda and pre-conference buzz have centered on the tenous state of the word economy. Terms like "rebalancing," a "changed global reality" and "economic recovery" are already hot topics. Indeed, the conference theme this year is the relatively bleak "Shared Norms For A New Reality."
The WEF's founder and chairman Klaus Schwab reiterated the weariness of tone in in Davos this year by warning that the economic recovery may be hindered by "global burnout syndrome." "We have in the world a situation where the political system and the institutions are just overwhelmed by the complexity which they have to face," Schwab told Reuters last week.
In a 50-page report, the WEF recently outlined nine of the biggest risks to global security, including global imbalances and currency volatitly, water security and corruption. It's certainly not a cheery read.
In a recent blog post, Reuters.com's top editor James Ledbetter takes the macro view of the conference agenda and asks three (and a half) very crucial and central questions of the Davos gurus. As Ledbetter notes, the WEF cites rising economic inequality as a global danger, but offers little insight about solutions. "Global governance institutions have been demonstrably ineffective in addressing the economic structural issues that the WEF now worries about," he writes.For a very abridged list of the conference's attendees, click here.