Tuesday, April 28, 2009

Banking on the Fund
http://www.economist.com/opinion/displaystory.cfm?story_id=13446763
Many of the Worlds developing countries are in serious need of additional money to help bail their country of its recession. Not every state has a financial system advanced as the United States that can get the economy out of a recession simply by lowering interest rates. The question comes from where the money comes from when nearly every country in the world is experiencing that same recession. The G20 has promised to give more backing to this fund, but with problems of their own it can be hard for the different countries to give in “charity”. In recent years, we have seen the world’s leading nations try to bulk up the fund by giving more to it, not when it is needed the most, we have the opposite happen by a decrease in amounts given.

IMF: Banks Need Billions More
http://www.forbes.com/2009/04/21/imf-europe-banks-markets-equity-recession.html
The number crunchers at the IMF are expecting $4.1 trillion dollars in loss of assets by the world’s banks and stating that in order to fix it billions of dollars will have to be given back for the banks to be able and confident to make additional loans. The IMF is expecting to give US banks over $250 billion dollars to get the economy back to pre-crises levels, not to mention the $375 billion it is planning to give the European banks. They are also considering giving specific countries, such as England, an additional $100 billion to jump start individual nations. All in all, the IMF is planning on contributing over $600 billion dollars to Europe. That is a lot of money.

A Developing World Bailout?
http://www.forbes.com/2009/03/10/bailout-g20-banks-business-washington-global.html
World leaders from the world’s most developed countries recently met to discuss the possibility of bailing the world out? The World Bank will need major donations from every country to essentially help every country. Not only are the countries bailing themselves out, but now they are considering bailing out each other. This is putting tremendous pressure on the more developed countries, such as the US who just spent $800 billion, and are now getting ready to send additional billions of dollars to foreign aid. The bank is expecting the United States to be the leader in this role and contribute over 4% of its annual GDP to the bailout. The final vote has not taken place yet, and many countries are still on the fence, but one thing is certain, change has come!

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