1213GMT - The shape of the deal emergeth
Here's where I think it's going. There's going to be a big number announced that is an add-up of extra money for the IMF, extra Trade Finance via the World, Regional Development Banks and bilateral deals, plus Special Drawing Rights from the IMF.
I understand the IMF part of the deal could be in the region of an extra $500bn as I indicated earlier; the extra trade finance piece will be around $100bn; so to get it anywhere near a politically significant $1trillion, a hefty chunk has to come from expanding the IMF's SDR programme. Currently $20bn it will likely be hiked significantly.
What this does is allow the governments to put a big figure on their already-agreed fiscal stimuli (a recent private estimate was 2.7 trillion over 2 years). Then put another big figure on what you might call international-institution liquidity plus loans.
This is what they are agreeing to do in lieu of a fiscal stimulus. Expect Gordon Brown to come out and say we've injected an extra trillion dollars into the economy.
OK, so what's the price they pay for this. To get China to stump up to the IMF they may have to agree to keep Hong Kong and Macau off a blacklist of tax havens. The furia franchese is now, I understand, being directed no longer against the US/UK but against various emerging market countries that often figure in James Bond movies when the scriptwriters want to indicate sleaze. And I mean countries that are actually seated at the table, not tiny "offshore" tax havens.
So what's left is the shape of the commitment on global regulation. Here the language is important: the French/Germans want a principled commitment - every nation, every player, every financial instrument comes effectively "onshore" and "on balance sheet". This is what they're working on now.