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Argentina: Sovereign advisory elite in the shade

It's one of finance's most elite clubs, though its members don't accept that it exists. It's made up of the handful of heavyweight economists who advise governments in emerging-market crises while holding down senior positions at the investment banks that lend money and arrange financing for these countries. But Argentina has exposed the limits of their power and raised questions about whose interests they're serving.

David Mulford, chairman of CSFB International; Jacob Frenkel, chairman of Merrill Lynch International; E Gerald Corrigan, managing director of Goldman Sachs; Ernest Stern, managing director of JPMorgan Chase; Bill Rhodes, vice-chairman of Citigroup - put together they have around 125 years' experience in emerging markets.

They have been close to power - rarely quite in it - for 25 years each, as central bankers, World Bank or IMF economists, under-secretaries of the US Treasury and heads of Federal Reserve banks. And now they are putting their experience to use in the private sector as roving ambassadors for the world's biggest investment banks.

If a developing country's economy looks as if it is coming unstuck, there is a very good chance the country's finance minister will soon be sitting in a room with these people, trying to work out a deal. If you see one of this exclusive club talking to a finance minister at a World Economic Forum meeting in Davos, an IMF session or the Trilateral Commission, it's a good bet that the minister is considering doing a debt swap or launching a new wave of privatizations or a new currency regime. And when they do, one of the club will be by their side, just out of the frame in the photos in the papers, advising the government and winning the fees for his bank.

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