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Will The Imf Save The World?

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Will the IMF save the world?

Don't think so

The finance ministers and central bank governors of the world gathered this weekend in Washington for the annual meeting of countries that are shareholders in the International Monetary Fund. As financial turmoil continues unabated around the world and with the IMF's newly lowered growth forecasts to concentrate the mind, perhaps this is a good time for the Fund – or someone – to save the world. There are three problems with this way of thinking. The world does not really need saving, at least in a short-term macroeconomic sense. If the problems do escalate, the IMF does not have enough money to make a difference. And the big dangers are primarily European — the European Union and key eurozone members have to work out some difficult political issues and their delays are hurting the global economy. But, as this weekend's discussions illustrate, there is very little that anyone can do to push them in the right direction.

A potential recession in the eurozone and a weak recovery in the United States does not make for a world crisis. Beware people who demand that the world be saved – usually they are making the case for a bailout of some kind.

Don't get me wrong — a serious crisis could still develop. There are plenty of warning signs regarding the situation in Greece and its potentially broader impact. According to the IMF's Fiscal Monitor, also released last week (see p.79) Greece's general gross government debt is now forecast to rise to nearly 190 percent of GDP in 2012, before falling back towards 160 percent by the end of 2016. At this point, Greece needs a global growth miracle – and there is no sign of this on the horizon.

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If the problems do escalate, the IMF does not have enough money to make a difference.

So they'll gear up, or they'll print.

Or more likely - both.

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Will it F***

Only Gordon Brown can save us now.

If only he had got the job to head the International Muntery Fund all these problems would be in the past by now. After all he did have the recovery locked in :lol:

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Beware people who demand that the world be saved – usually they are making the case for a bailout of some kind.

It's funny how every solution to the problem proposed by Bankers seems to involve propping up bankers. A more cynical person might suspect that they have less than pure motives for offering this advice.

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  • 336 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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