On Apr 16, 2007, at 4:50 PM, Patrick Bond wrote:
> After the two South American countries, who happened to be the IMF’s
> largest borrowers, set the example, others followed. Serbia,
> Indonesia,
> Uruguay, and the Philippines made similar announcements. With the
> addition of Indonesia to the list, three of the four largest
> debtors to
> the IMF had liberated themselves. The fourth, Turkey, is reportedly
> considering taking the same step before the end of 2007. With all
> these
> early repayments, and the gathering certainty that virtually no
> “middle-income countries” would be giving the IMF more business, it
> soon
> appeared that the IMF might face a crisis of solvency. Indeed, the
> institution is expected to post its first loss in decades–about $100
> million–this year.
Either that, or we've gone too long without a financial crisis. I say that not out of love for the IMF, of which I have none, but because the financial markets have gotten so complacent about risk that no one thinks twice about pouring money into what, in more normal times, would be regarded as a potentially treacherous place. Junk bonds, "emerging markets," and, until just a little while ago, subprime mortgages - all have had no trouble pulling in the cash. We haven't had a major bust-up since the dot.com debacle almost seven years ago (though the subprime thing is starting to look that way). And no international crisis since, what?, Russia nine or ten years ago.
Doug