The International Monetary Fund (IMF) is considering a new scheme for the allocation of billions of dollars that would apply in times of crisis by offering money to states, even if they do not like them, said the Wall Street Journal. According to “multinational credit line for the first time the IMF will allocate funds to groups of countries which it considers are in danger in times of financial crises, rather than individual countries, says a senior official of the fund. Not necessarily the parties have requested assistance, but rather the IMF will provide credit lines to those countries whose policies deemed reasonable. Member will be required to utilize the money. “The fund will declare that there is a systemic problem and a credit line granted to the following countries,” said the officer. He stated that no formal proposal is expected to be ready by September and will need to be approved by the Governing Board of the IMF. “We are looking for a new focus and capacity to deal with systemic risks”, said on Friday the fund’s managing director Dominique Strauss-Kahn, in a speech which hinted at the proposal.
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The CEO of the Bank of England (Bank of England) Marvin King on Tuesday proposed a radical reform of arrangements for managing the international economy, says the Telegraph. King insisted that an effective merger of the functions of the G-20, which includes 19 countries with the largest economies in the world plus the European Union with those of the International Monetary Fund (IMF). According to King, if the authorities did not establish an international body which has authority to reform the monetary system, the world may run into another crisis in a few years. He warned that paying very close attention to efforts to reform the financial sector, but in the meantime the economic imbalances that have resulted in crisis continued to worsen. Marvin King has repeatedly expressed its concern about imbalances in the global economy. They have accumulated after a period of many years, rich countries have relied on loans to pay for cheap exports from overseas. To solve this problem, he believes that politicians need to transform the institutions currently responsible for the global economy. Governor of the Bank of England believes that the G-20 can take the task to push reforms needed to induce exporters to increase their domestic consumption, a population of indebted economies like the United States and Britain to start saving more. According to him the legitimacy and authority of the G-20 will increase if the group become the Board of the IMF. Marvin King strongly criticized the IMF in recent years after the Fund has warned repeatedly about the extent of imbalances in the global economy, but their actions failed to achieve any noticeable reform in the creditors nor the debtor countries.
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Dominique Strauss-Kahn, who is managing director of the International Monetary Fund said that world leaders must continue to reform the financial sector to avoid a repetition of last financial crisis. We need reforms and political will, “said Strauss-Kahn, he added, a financial forum in Hong Kong. Much remains to be done. I’m afraid that after six or 12 months, all will work again as before and that lessons learned from the financial crisis will be forgotten, warns the head of the IMF. He stressed that the pace of revitalization has been weak and uneven, noting that the Asian region growth accelerated faster than the rest of the planet. The companies forgot this quite fast commented the specialists and analyzers.
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India, which is the largest consumer of gold in the world, has bought 200 metric tons of bullion by the International Monetary Fund (IMF) against 6.7 billion dollars. This is happening against a background of growing interest among leading central banks around the world to diversify its foreign exchange reserves can thus protect themselves from the depreciation of the dollar. The deal amounts to 8 percent of world production of gold. This is the largest such transaction to the IMF for the past nine years. Thus, India ranks ninth in the amount of their gold stocks, according to the London-based research company GFMS Ltd. The news surprised analysts who are conjugate China for potential buyers. India’s gold reserves amounted 358 metric tonnes before the transaction. India has purchased gold for an average price of 1045 dollars per troy ounce, says the IMF statement. The price of gold rose by 0.2 percent today to 1601.48 dollars an ounce on the London Stock Exchange. On October 14, the metal rose to a record 1070.80 dollars an ounce.
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