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PVAF LIFE TRUTH SEARCH SERIES CONTINUES.....IMF...the three letter 'dirty word" AMONG POOR NATIONS whom IMP WAS CREATED TO SERVE in their growth to pr
Posted by Vishva News Reporter on November 29, 2010 |
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.....HYPERLINKING WORDS TO
INTERNET KNOWELDGE SOURCES...... |
| PVAF in its continual search for
knowledge and more knowledge to find the
TRUTH
of our existence from epistemological aspect of our existence...has now
been hyperlinking all its publishing on this website to internet
knowledge sources...Please click on the hyperlinked words to enlighten
and educate yourself to whatever depth you wish...Please be aware that
many internet knowledge sources are not only evolving in its
comprehensiveness plus accuracy and may only convey knowledge as defined
by the word "verisimilitude"
meaning to a degree of truth/false...we urge knowledge seekers to keep
on searching for Truth.... |
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| An amazing human phenomenon that is happening repeatedly with
IMF...as part of money-based-greed serving selfish purposes of those who
have money to lend to others....and thus going against the original
altruism and compassion for the poverty affliction of the founding
fathers of IMF...or were the founding fathers duped by the money people
right at the start... |
| To read the amazing but true facts
leading to the above statement please click on the next line.....including
sthe 2009 story of the IMF being booted out of Albania after 17
years.... |
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......BEFORE YOU READ THE TODAY'S NEWS
STORY.....
YOU MAY WANT TO EDUCATE
YOUSELF
ABOUT IMF
THROUGH WIKIPEDIA ARTICLE
WHICH
IS PROBABLY EDITED BY
THOUSANDS OF HUMANS TO BRING OUT
THE TRUTH ABOUT
THE CREATION AND EXISTENCE OF IMF....
The
International Monetary Fund
(IMF)
is the
intergovernmental organization
that oversees the
global financial system
by following the
macroeconomic policies
of its member countries, in particular those with an impact on
exchange rate
and the
balance of payments.
It is an organization formed with a stated objective of stabilizing
international exchange rates and facilitating development through the
enforcement of
liberalising
economic policies[1][2]
on other countries as a condition for loans, restructuring or aid.[3]
It also offers loans with varying levels of
concessionality,
mainly to
poorer countries.
Its headquarters are in
Washington, D.C.,
United States.
The IMF's relatively high influence in world affairs and development has
drawn heavy criticism from some sources.[4][5]
Organization and
purpose
The International Monetary Fund was
conceived in July 1944 originally with 45 members and came into
existence in December 1945 when 29 countries signed the agreement,[6]
with a goal to stabilize exchange rates and assist the reconstruction of
the world's international payment system. Countries contributed to a
pool which could be borrowed from, on a temporary basis, by countries
with payment imbalances (Condon, 2007). The IMF was important when it
was first created because it helped the world stabilize the economic
system. The IMF works to improve the economies of its member countries.[7]
The IMF describes itself as "an organization of 187 countries (as of
July 2010), working to foster global monetary cooperation, secure
financial stability, facilitate international trade, promote high
employment and sustainable economic growth, and reduce poverty".
....To continue reading this article on Wikipedia please click
here and after finishing reading please come back to this
web page to read the today's story about IMF and Ireland and other
countries "touched" by IMP for more than 60 years ....
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.....AND NOW TODAY'S NEWS STORY OF
AMAZING 66-YEAR JOURNEY OF IMF.....
......followed by related news including
IMF experience of the young nation of Albania.... |
What Ireland proves:
The need for a world without bailouts
(From Canadian
Globe and Mail: Nov.
27, 2010: Doug Saunders in Dublin, Ireland;
a member of The Globe and
Mail's European bureau)
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Standing on Dublin's Merrion Street on Thursday, I
could just as well have been in Buenos Aires in 2003, Ankara in 2000,
Lagos in 1989 or Kingston in 1979. The people were more pallid and
generally better fed, but the anger and the slogans were identical. So
was the graffito someone had spray-painted on the side of the building,
as they do all over the world: “IMF go home.”
Ireland to rise again, with or without euro When that three-letter
abbreviation becomes known and understood by people who take the bus to
work, your country is in trouble. The International Monetary Fund was
designed, in the 1944 Bretton Woods conference, to be part of the
subfloor plumbing of the world's economy, to keep money flowing between
countries and prevent the sort of inflationary debt-default disasters
that put Germany in Hitler's hands. But it came to take on a more
infamous role as the archangel of international finance. An IMF bailout
is a dark punctuation in any nation's history, a humiliation that is
never forgotten.
Ireland's experience this week was much like what people saw in Nigeria
in 1989 or Britain in 1976: First, the country discovers that
international bond markets, frightened by its unstable economy, will no
longer lend it money at a price it can afford. So the IMF team from
Washington checks into the expensive hotel across from the finance
ministry, pores over the books and then delivers a Structural Adjustment
Program – drastic reform that turns the country's whole economy into a
debt-repayment machine.
Government is gutted. Taxes rise; subsidies and grants vanish; social
programs are pared back; state companies are sold; wages are slashed.
Ideally, debt drops and investors regain confidence. But the poor and
middle classes pay the price for mistakes made by governments and
bankers. Cue rioting and electoral defeats.
Some IMF bailouts – economists call it conditional lending – do help to
turn countries around. Brazil and Turkey (which this year ended 50 years
of IMF stewardship) have built economies with real social benefits,
though the process has often been calamitous.
Other times, the IMF is a handy scapegoat. After the Second World War,
many former colonies in Asia, Africa and South America developed false
economies loaded with regime-owned companies and isolated from the world
through trade barriers, all sustained only through debt. In the 1980s,
this house of cards fell apart and scores of countries went into
economic crisis.
The resulting bailouts marked the beginning of an era of genuine growth
for countries such as India. But the conditions were often devastating,
preventing growth from being used to support social mobility. In
left-wing circles, it's still common to blame the suffering caused by
postwar economic authoritarianism on the IMF adjustments that followed.
Countries like Venezuela and Zimbabwe have been driven to extremism and
isolationism that feeds on anger at the IMF.
The fund itself admits that its actions in Southeast Asia and Latin
America in the late 1990s were harsh enough to destroy prospects for
growth. In Indonesia, a bailout led to a further crash. The ultimate
disaster was Argentina, where the IMF endorsed heavy borrowing, deep
government spending and a dangerous fixed-currency system in the 1990s,
and then responded to the inevitable collapse with a brutal bailout that
led to a paralyzing, full-scale debt default.
The current IMF managing director, French socialist Dominique
Strauss-Kahn, took over in 2007 on a pledge to end all that. He has
moved to set up a new system where a poverty-alleviation plan is part of
the deal, the country is given a bigger stake in its own fate and
longer-term concerns are taken into account.
At the Seoul G20 summit this month, reforms passed to turn the IMF into
an organization mainly owned and controlled by developing countries, so
it will no longer be the Western world's fisher of souls among the
world's poor. In fact, the opposite may be true: As observers have
pointed out, China is now wealthy enough to purchase the entire IMF
outright, while the largest bailout recipients are in Europe.
But there, the IMF has been dragged into uncharted waters and is again
engaging in the very practices it abandoned a decade ago. The Greek and
Irish bailouts (and possible Portuguese and even Spanish ones) are,
monetarily, mainly European Union bailouts: Two-thirds of the money
comes from a special fund created by the German and French governments.
But the IMF is delivering the blow. It reportedly argued in favour of a
more gentle and progressive plan, but was overruled by the EU, which
sought quick recovery of debts.
I
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reland's government was not in trouble. It did not have the
overspending and long-term-debt problems that Greece did. Ireland's
fiscal balance was fine except for the need to take control of the
failed private banks. So the IMF has taken on a new role, as a guarantor
of private banking and private-sector stability, that is far removed
from the visions of 1944.
Our best hope is that the Irish debacle shows, vividly, what is wrong
with the whole ritual: Even a sensitive and caring bailout is not
designed to help a country. It is designed to help lenders get their
money back.
The IMF is the prime lender to troubled countries, and acts on behalf of
other lenders. A country's longer-term interests may get token
consideration, but the thrust is to make it repay bonds reliably and
without inflation. This will always create more problems than it solves.
First, it is countercyclical. To take enormous sums of money out of an
economy in the middle of a downturn is only going to exacerbate the
cycle of failure. It happened in Southeast Asia; it will happen in
Ireland.
Second, it creates moral hazard. Because a bailout is expected to spare
bondholders pain in case of trouble, institutions lend recklessly to
countries without sound fundamentals. Bailouts are now anticipated and
demanded: Ireland watched this month as interest rates on its 10-year
bonds soared to an unaffordable 9 per cent – not because there were any
signs that its economy was insolvent, but because investors were not
going to put their trust in a country with failing banks without promise
of a bailout.
“The IMF doesn't put out fires,” Harvard economist Robert Barro famously
argued. “It starts them.”
Third, while they are sometimes a useful excuse for tough measures by
governments such as Turkey's and Brazil's, there's no indication that
IMF plans actually improve anything in themselves, and plenty of
evidence to the contrary. IMF economists Ashoka Mody and Diego Saravia
found that bailouts work only for countries that were likely to have
saved themselves anyway. Meanwhile, countries that undergo multiple
interventions fare worse in the lending market because the IMF's
presence is seen as a sign something must be wrong – even if it isn't.
After four decades and hundreds of bailouts, there is no clear pattern
of improvement: That would be a poor track record for any investment
outfit, never mind one capitalized with almost a trillion dollars.
Finally, bailouts do long-term damage to the world's economy and social
structure. Economist Sherle Schwenninger of the New America Foundation
has found that, even though many of the financial reforms of the late
1980s and early 1990s were necessary, the violent way the IMF delivered
them hollowed out the middle class of the developing world.
“Most of those countries,” he said, “forwent 2 to 3 per cent of GDP just
on austerity in those years. You could have had less loss of the old
middle class and a much broader expansion of the new middle class if
you'd taken a more gradual approach.”
That is the danger in Europe now: Economies may be rendered stable
again, but the process could cut off paths out of poverty for a
generation or more.
There is some understanding today that this is simply not the right way
to do things. German Chancellor Angela Merkel is pushing to pass reforms
so that bondholders will have to participate in the rescue of countries
from financial crises. This has been the IMF's direction as well.
On the other hand, Argentina restructured its debt this month without
any help from the IMF. Burned from a decade of insolvency, it went
directly to its lenders and renegotiated the debt. This wasn't easy:
Much of what it has done is what the IMF would have imposed, but at its
own pace, with its best interests in mind. It's what smart countries
might do if there were no IMF.
Here, we can begin to see the shape of a world without bailouts. It's a
world where there's nobody to blame but yourself, where the goal might
be something other than simply paying everyone back as quickly as
possible – and where the arrival of men in suits from Washington doesn't
cut a black hole in a country's history. |
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More related to this story
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....and now a 2009 supporting evidence
story from...
.....Albania Bids Adieu to IMF Amid Bickering... |
Albania Economy: Tirana, Jan. 08, 2009
The International Monetary Fund, IMF, ended its mission to Albania on
Thursday after monitoring its economy for 17 years, its departure
criticised as premature by economic experts and the opposition.
Prime Minister Sali Berisha described the end of the IMF mission as the
end of post-communist transition for the Albania’s economy.
“This is the end of the transition of what used to be one of the most
centralized economies in Europe and in the world,” said Berisha. “For a
democratic country, there is nothing more important than a solid market
economy, and now Albania can move forward on its own feet.”
Minister of Finance Ridvan Bode said “Albanian institutions have
achieved the necessary maturity to manage the country’s finances”.
However, the decision not to renew the IMF’s tenure in Tirana was
cricitised by the opposition, who been quick to accuse the Prime
Minister and the Minister of Finance of arrogance and irresponsibility.
Experts fear the government’s populist policies could undermine tight
fiscal discipline. In its yearly report on Albania for this year, the
IMF remarked on that danger, noting that “popular politics is the main
risk to Albanian macroeconomic stability”.
According to Selim Belortaja, head of the Albanian Center for
International Trade, politicians don’t yet show responsibility when it
comes to public spending, while financial institutions are not yet
prepared to act independently.
“Albania has only enjoyed financial stability because behind any
government decision there was an IMF official,” Belortaja told Balkan
Insight in an interview late last year.
Officials have already started to bicker about growth numbers. Earlier
this week, Albania’s Finance Minister rejected an economic growth
projection given by the state statistics institute, but found himself
rebuked by the Prime Minister.
The statistics institute INSTAT projected that Albania registered a
record high Gross Domestic Product growth of 9.9 percent in the last
four quarters ending September 30. Finance Minister Ridvan Bode said
that the INSTAT projection was only for a quarter, while growth for the
year was between 6.0 and 7.0 percent of GDP.
Bode was later rebuked by Premier Sali Berisha, who said the Finance
Ministry was not talking about the real numbers. But the IMF head of
mission in Tirana, Ann Margaret Westin, rejected Berisha’s claim of
double-digit growth.
“We believe that growth is within our projection of 6 per cent of GDP,”
said Westin.
However, even Westin was chastised by Berisha, who said he believed
economic growth in the country was being under-evaluated and lashed out
at the media for being economically illiterate.
“The problem is that your knowledge
of the economy is zero,” Berisha told reporters, adding
that they were trying to impose a debate that was not real.
Source: Balkaninsight
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