Global Economic News
Hyperinflation Specter at IMF Meeting
Oct. 10 (EIRNS)At this weekend's IMF meetings, the threat of global hyperinflation, resulting from bailout money-printing by the Federal Reserve and other central banks, was apparently the leading item of discussionbut under a cover phrase, "currency wars." That was thrown out by IMF Executive Director Dominique Strauss-Kahn in his speech, focussing on Obama Administration pressure on China to revalue its currency, but referring, as Strauss-Kahn said, to "everybody cheapening at once"many central banks and governments all trying to drive down the value of their own currencies.
What does this mean? Ultimately, various forms of money printing, trying to overcome economic collapse and pay unpayable debt, bailing out banks and financial companies, and "getting them to lend"but also to buy other currencies, and drive down the home currency.
The Christian Science Monitor headline, "IMF Nations Have No Solution for Currency War Threat," was typical; the governments represented "had no answers" and asked the "IMF to find a solution."
While U.S. politicians bashed China, the IMF final statement reflected the arguments of developing countries, that the U.S. economic collapse is a fundamental cause of imbalances in the global economy, with U.S. money-printing policies fueling the dollar weakness.
ITAR-Tass quoted Russian Finance Minister Alexei Kudrin at the IMF: "In the beginning of the year, all the forecasts were changed for very optimistic ones; while after the second quarter, they were returned back [to the grim ones of 2009]. This proves that every quarter may change the situation and that big uncertainty still remains."