The International Monetary Fund is poised to embark on what analysts have described as "global quantitative easing" by printing billions of dollars worth of a global "super-currency" in an unprecedented new effort to address the economic crisis ...This is totally insane. I don't have any other word for it. I haven't seen any reference to this anywhere else, so I question the accuracy of the article because the concept is completely crazy.
Alistair Darling and senior figures in the US Treasury have been encouraging the Fund to issue hundreds of billions of dollars worth of so-called Special Drawing Rights in the coming months as part of its campaign to prevent the recession from turning into a global depression ...
Simon Johnson, former chief economist at the IMF, said: "The principle behind it is that everyone would get bonus dollars and instead of the Federal Reserve having to print them, everyone gets them."
Pre-publishing Update: Mish tells us that it is indeed possible. Here, he quotes from this article and then analyzes it.
I'll say it again: This is totally insane. Conspiracy nuts have been worried about handing over sovereignty of our foreign policy to the UN, but handing over control of printing money to the IMF seems even worse.The IMF, led by Dominique Strauss-Kahn, has the power to raise money on the capital markets by issuing `AAA' bonds under its own name. It has never resorted to this option, preferring to tap members states for deposits.AAA rated IMF nuclear printing. Now there's a joke. Who gets to make that rating call? What printing presses are backing up the IMF printing press?
The nuclear option is to print money by issuing Special Drawing Rights, in effect acting as if it were the world's central bank.
5 comments:
At least the money will probably be really pretty and colorful, not all drab like US money. Maybe they'll have some classic artwork on it, like Germans pushing wheelbarrows of money, or Zimbabweans printing million-dollar bills.
I've always been partial to central American currency where the glorious leaders' heads take up 3/4ths of the bill.
Actually, I doubt that they are going to "print" anything. I expect that it will be electronic money, basically a claim that "Sure, we have this money, and we will electronically tell your bank that now *you* have the money". Which means that they can . . . well . . . create any currency they want.
This would be astoundingly helpful for them. They could create electronic dollars until dollar inflation becomes excessive, then they could switch to yen or euros or pounds or what-have-you, and make sure that *every* currency gets inflated, not just the ones where the originating country has unsound policies.
The fact that it sounds like the actions of a counterfeiting ring, not a bank, is beside the point.
Tim,
The fact that it sounds like the actions of a counterfeiting ring, not a bank, is beside the point
LOL!
That's got to be the comment of the day!
I can't think of a reply that wouldn't make it clear what service I was in....
Post a Comment