Global Trust (a new global bank)

February 11, 2009

Sankarshan Acharya
Pro-Prosperity.Com and Citizens for Development


February 11, 2009

To:       Honorable President Barack Obama

Cc:       Honorable Vice President Joe Biden

Honorable Speaker Nancy Pelosi

Honorable Senator Harry Reid

Honorable Senator John McCain

Sub:     Float a “Global Trust” bank

Dear President Obama,

Here is a proposal to solve the financial crisis by enlisting the trust of global export powerhouses like China and Japan. Create a bank, naming it “Global Trust.” The GT can be structured as follows:

$612 billion in equity

$3060 billion publicly issued debt

Equity Components:

$100 billion from the U.S. TARP funds

$100 billion from China

$100 billion from Japan

$312 billion private equity to be raised by IPO 

Leverage: 1 (equity) to 5 (debt)

Majority ownership of equity is 51% by private stockholders

Minority ownership of equity is 49% by three governments

Great Trust will be managed by a professional CEO, chosen by an independent board of directors which will include about 49% of members chosen by the three countries, equally from each participating country.

Great Trust will bid for troubled assets in banks and make strategic investments globally starting in USA.  The GT is so designed that it is bound to succeed in restoring the trust of the investors, globally, in the American financial system and ingenuity.  I would be surprised if China and Japan will reject the proposal.  Countries like India may join as junior partners, but they are not crucial.  China’s expressed concern about the integrity of its reserves vis-à-vis quantitative easing (printing) by the US Federal Reserve should be taken seriously.

With profound regards,

Sankarshan Acharya

PS: Global Trust Bank will serve the best interest of taxpayers because it will be privately managed with significant prorata taxpayer interest. It will reestablish the trust of the investors in the system of banking and governance, globally.