Viewed against Dubai's ever-expanding horizon of cranes and skyscrapers, anything seems possible: even that Western banks might find capital from sources other than their governments. Yet at this week's buoyantly named "Super Return" conference, the mood among private-equity and sovereign-wealth types was unusually demure. Stephen Schwarzman, the boss of Blackstone, a buy-out firm, spoke for many when he warned of trying to "catch a falling knife and severing the tendons in your right hand".rnMost governments hope that having guaranteed their banks' survival they will encourage outside investors to come back in. After all, private-equity firms are sitting on about $450 billion of "dry powder"-funds raised but not yet spent. And sovereign-wealth funds have assets of $2 trillion to 3 trillion, much of which is sitting idly in American Treasury bonds. Meanwhile, the imf thinks American and European banks need $675 billion of new capital.
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