This picture on the ‘Huffington Post’ site is so charming and spontaneous I couldn’t resist smiling. I then SMS’ed my friend, GC, and told him that the Italian premier, Silvio Berlusconi, had managed to ensconce himself with the trio of the world’s most important economies: the US, Russia and China.

GC called me back and we had a great conversation about Berlusconi, whom it transpires he’s known for many years.

In any case it’s good that despite all the supposed political frictions and grandstanding going into the summit, some core principles were agreed upon regarding tighter and more coordinated international regulation of the financial system, and that the IMF’s lending facilities were boosted three-fold to US$750 million from its present US$250 million. This will enable it to support developing economies more as they too try to survive the global recession so it’s a welcome move. Clearly, due consideration will have to be taken in TARGETED and measured lending to prevent some governments from attempting to call on IMF funds and then misspending those funds. However, in principle, boosting IMF monetary funds is a good decision from the G20 summit.

Now, some people may wonder why I as a former banker and someone who believes in capitalism would welcome stricter regulation. This is because I believe in capitalism of a particular kind: SOCIALLY RESPONSIBLE and INFORMED capitalism. The current system is not as informed as it could be which partially explains why bubbles were allowed to build (from complex instruments like the mortgage CDOs, offshore SPVs, hedge funds etc.), undetected, until the burst became inevitable and resulted in a domino / ripple effect through the global economy.

There had been a lot of, “We didn’t know this was going on. There was no information available to us,” which doesn’t abrogate responsibilities from anyone but it does reflect that information is not being effectively channeled to important decision-makers; these are defined as people who affect the global economy — whether they be politicians, economists, bankers or consumers.

If they don’t have this information readily available or calculable:

· risk exposures of off-balance sheet SPVs

· hedge fund accounting

· reward structures without floors or ceilings for people who are speculating with others’ pension funds, assets, mortgages etc.

Then some of the decisions they make are bound to be from a blind spot; this means they’ll hit the iceberg sooner or later, and it’s something we all want to prevent because it takes innocents down with them. This has been seen with ordinary taxpayers being tied into various government bailouts (financial institutions as well as automobile and other sectors). Instead of directing funds which could otherwise have gone into building schools, hospitals, telcoms and other infrastructure, governments are being forced to prop up the banking system to prevent total collapse and economic anarchy.

So when I say “socially responsible capitalism” I mean the type that will support the ability for interested parties to allocate their funds towards building schools etc. whilst also enabling individuals to be entrepreneurial and generate profit and rewards.

Let me be clear: there is nothing inherently wrong with the pursuit of profit, value, growth and rewards in a capitalist democracy. However, there is also everything right with being INFORMED on a real-time basis about all the worst-case scenario consequences of how that pursuit is conducted and impacts upon the wider community.

What has struck me from my operational experiences within banking as well as now with the Internet commentary on the global financial crisis has been the absence of technology voices to say how THEY can and would contribute to solutions — both of information coordination as well as providing tools to make sense of that information to provide better decision-making tools at the disposal of political leaders, civil servants, central bankers, senior investment bankers and pertinent others that will prevent a re-occurrence of the current situation.

There are security concerns with respect to sharing and coordinating information electronically on this scale. Nevertheless, it may be worthwhile to have these conversations from the outset. Let’s have the social media sphere make genuine innovations and work out how to harness crowd-sourcing and collaboration tools (to contribute to solving serious issues) — instead of throwing electric sheep at their followers or amplifying their ADHD by limiting the full capacity of their intelligence to a 140 character tweet.

Now is the time and Tim O’Reilly himself has also asked for more seriousness from this next generation of tech entrepreneurs:

* http://latimesblogs.latimes.com/technology/2008/10/tim-oreilly-get.html

As for me, tomorrow I have a catch-up lunch with GC. We always have very interesting and productive conversations so I’m looking forward to it.

Next week I’ll meet some Silicon Valley people and I intend to ask them for their insights on how technology can play a more central role in getting the global economy back on its feet as well as preventing future re-occurrences of this last year: an annus horribulus economica.