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(CEP News) - The top finance official from Italy called for radical reform of the international banking, saying he wants to scrap the set of agreements and institutions that govern the worldwide economy.
Little escaped the scorn of Italian Economy Minister Giulio Tremonti on Saturday. He said he wants to change the G7, World Bank and IMF; to rewrite Basel II and to consider abolishing hedge funds. Tremonti outlined his ideas to the G20 club, which include draft changes to Bretton Woods, then commented to reporters on Saturday. Italy assumes the presidency of the G7 in January and Tremonti said he wants to expand the number of countries in the body and "adopt a large structure." He also hopes to broaden the IMF and World Bank so they "can be used for different goals." Tremonti has in the past criticized international financial agreements but ratcheted up his rhetoric on Saturday, saying Basel II is "dead". The 2004 international accord regulates how much capital banks need to have on hand to safeguard against insolvency. "I always said Basel II was stupid, now the others are agreeing," he told reporters. Tremonti said he would support the principals outlined in the G7 statement after refusing to sign an earlier draft, calling it inadequate and "business as usual." He said the new plan is "coherent" with the European and Italian positions but when asked if he was happy about the principle-based plan, he responded "happy is too much." Tremonti saved his harshest words for hedge funds and other "absolutely crazy bodies" saying they have "nothing to do with capitalism." He was asked if hedge funds should be banned and said "we have to launch a discussion about this." Tremonti said he will outline his ideas for reform of the G8 on Sunday. Some of Tremonti's statements clash with comments from Bank of Italy governor Mario Draghi. Draghi called the G7 statement "excellent" and said Basel II isn't deal, but needs to be resuscitated in another form. By Adam Button,
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