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Tag Archives: IMF

GDP and Public Wealth

According to a recent article put out in the IMF Blog

“advanced economies have larger balance sheets compared to emerging markets and low-income developing countries. This reflects the size of their public sectors, which generally provide more infrastructure and services. But advanced economies also have larger liabilities and, on average, lower net worth.”

So what does that mean?  Almost 40 countries has a total of public sector assets (infrastructure, financial assets and natural resource reserves) worth $103 trillion. That comprises 216% of GDP.

It has been found “that having large assets does not necessarily reduce how vulnerable a country is to large debts; this will depend on the nature of the assets.” How can this situation change?  Possibly with better management. According to the Blog:

“Better management of government assets could earn 3 percent of GDP in extra revenues each year—that is more than the interest payments advanced countries pay to cover their debt.”

Some countries are already doing this.  Examples include: Australia, the UK and New Zealand which are all engaging in a review of their balance sheet. Jersey is making waves toward greater transparency such that by 2023 the law will really be forcing the issue.  A joint Guernsey, Jersey and the Isle of Man statement included the intention to:

“bring public company registry legislation to their respective parliaments within 12 months of the EU publishing a review in 2022 outlining how their members states have created their own public registers.”

GDP can be a good indicator of wealth.  When it is codified correctly it has the power to give us information about consumption levels and when GDP depletes it can be a useful red flag for new policies.

Christine Lagarde Calls for Immediate Action

Christine Lagarde, head of the International Monetary Fund, recently called for additional action as Europe continues to grapple with debt and the U.S. struggles with an impending fiscal crisis. Lagarde claimed that the world economy is faring worse than even the more pessimistic expectations. Though the European Central Bank and European governments have taken several… Continue Reading

IMF Projects Slowest Growth Since Recession

The International Monetary Fund projects slow global growth as the euro zone’s situation worsens and other economies remain threatened. It states that the world economy will grow a total of 3.3% this year. This is the slowest since the recession in 2009. “A key issue is whether the global economy is just hitting another bout… Continue Reading

IMF Reveals Bleak Outlook for Global Economy

A recent statement by the IMF claims that the world is perched precariously on the backs of the U.S. and European economies. Global growth will remain stunted until they improve. According to their website, Europe’s persistent crisis has hindered global economic recovery into the second quarter. Predictions from the World Economic Outlook say global economy… Continue Reading

Quote of the Day: Christine Lagarde

Meteorologically speaking, spring is usually a welcome relief from cold, dark winter. However on the economic front, at least this year, there is a fear that this spring will bring the US economy back to the dreary days of last year’s recession, which this winter showed signs of recovery. As Christine Lagarde, the managing director… Continue Reading

IMF Warns Global Economy in Face of Rising Oil Prices

As debt crisis and economic turmoil sweep across Europe, the International Monetary Fund has identified another looming threat to global economy; rising oil prices. The fund strongly suggests monitoring tension between Iran and the Western world. The United States have sanctioned Iran’s oil consumers, and the EU is considering an embargo as well. Seeing as… Continue Reading

When It’s All Just Greek to the Greeks

Troubled Times for Greek Finance; Not Happy Swiss The Greek economy is up the creek without a paddle.  As well, this is impacting the Swiss populace which is now sitting around watching this turmoil unfold.  The Greek parliament has just said yes for increased austerity in an effort to meet EU-IMF bailout terms.  This led… Continue Reading

Financial Femme Fatale?

If Christine Lagarde – who was yesterday put on the shortlist to head the International Monetary Fund – succeeds, she will be “the first woman to head the global emergency lender.” She has a pretty good chance too, in the way she has been handling the world economic crisis until now. Once Dominique Strauss-Kahn handed… Continue Reading

Doom and Gloom Ahead for Global Economy?

Things aren’t looking good again. We keep hearing about the global economic crisis but were hoping that the recovery from it was well underway. Unfortunately, when looking at the stats, this doesn’t seem to be the case. Oil prices are increasing, sovereign debt burdens are becoming unsustainable and along with lack of certainty vis-à-vis the… Continue Reading