Sarkozy demands overhaul of global capitalism

 

French president Nicolas Sarkozy demanded an overhaul of the world's capitalist system today, saying the financial crisis had laid bare serious flaws in international banking.

In a keynote speech on the market mayhem, Mr Sarkozy said the crisis would weigh on the French economy for months to come, but promised that nobody in France would lose their bank deposits.

"A certain idea of globalisation is drawing to a close with the end of a financial capitalism that had imposed its logic on the whole economy and contributed to perverting it," Mr Sarkozy told some 4,000 supporters at a rally in southern France.

"The idea of the absolute power of the markets that should not be constrained by any rule, by any political intervention, was a mad idea. The idea that markets are always right was a mad idea," he said.

He repeated his call for major power leaders to meet before the end of the year to map out a new financial system and said it was vital to review currency levels, adding that both the dollar and Chinese yuan were undervalued.

"We cannot continue to manage the economy of the 21st century with the instruments of the economy of the 20th century," he said.

He also warned bankers and business leaders to curb their salary levels, saying the government would introduce legislation by the end of the year if they failed to reform themselves.

Reuters