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Economy
In reply to the discussion: STOCK MARKET WATCH -- Tuesday, 24 January 2012 [View all]Demeter
(85,373 posts)23. IMF chief says eurozone must do more to quell debt crisis
http://www.dw-world.de/dw/article/0,,15685965,00.html
..."It is not about saving any one country or any one region. It is about saving the world from a downward economic spiral," The former French finance minister said. "It is about avoiding a 1930s moment ... in which a combination inaction, insularity, and rigid ideology could cause a collapse of global demand."
She said that if Europe is to going to grips with the crisis it will need to create stronger growth, bigger firewalls, and deeper integration. Among the specific measures she called for were an increase in funds for the eurozone's future, permanent rescue fund and so-called "eurobonds," both ideas that are opposed by Europe's biggest economy, Germany..."We need a larger firewall," Lagarde said. "Without it, countries like Italy and Spain that are fundamentally able to repay their debts could be forced into a solvency crisis by abnormal financing costs."
...................................
Lagarde wants to plow even more money into the ESM. She suggested "folding" whatever cash was leftover in the temporary eurozone rescue fund, the 440-billion-euro ($570-billion) European Financial Stability Facility, into the permanent bailout fund, the European Stability Mechanism (ESM).
The 500-billion-euro ESM is expected to come into force sometime later this year, but Lagarde called for a "clear and credible" timetable to get it up and running. However she made a point of rejecting a suggestion reportedly made by Italian Prime Minister Mario Draghi, that the ESM should be doubled.
POOR CHRISTINE
..."It is not about saving any one country or any one region. It is about saving the world from a downward economic spiral," The former French finance minister said. "It is about avoiding a 1930s moment ... in which a combination inaction, insularity, and rigid ideology could cause a collapse of global demand."
She said that if Europe is to going to grips with the crisis it will need to create stronger growth, bigger firewalls, and deeper integration. Among the specific measures she called for were an increase in funds for the eurozone's future, permanent rescue fund and so-called "eurobonds," both ideas that are opposed by Europe's biggest economy, Germany..."We need a larger firewall," Lagarde said. "Without it, countries like Italy and Spain that are fundamentally able to repay their debts could be forced into a solvency crisis by abnormal financing costs."
...................................
Lagarde wants to plow even more money into the ESM. She suggested "folding" whatever cash was leftover in the temporary eurozone rescue fund, the 440-billion-euro ($570-billion) European Financial Stability Facility, into the permanent bailout fund, the European Stability Mechanism (ESM).
The 500-billion-euro ESM is expected to come into force sometime later this year, but Lagarde called for a "clear and credible" timetable to get it up and running. However she made a point of rejecting a suggestion reportedly made by Italian Prime Minister Mario Draghi, that the ESM should be doubled.
POOR CHRISTINE
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