Socrates & the Pope: Overheard at the IMF’s Spring Meetings


By IMFdirect editors

Socrates’ famous method to develop his students’ intellect was to question them relentlessly in an unending search for contradictions and the truth—or at the very least, a great quote.

The method was alive and well among the moderators, panelists and audiences of the IMF’s Spring Meetings seminars that took place alongside official discussions, where boosting high-quality growth, with a focus on the medium term, was at the top of the agenda.  Our editors fanned out and found a couple of big themes kept coming up.  Here are some of the highlights.

Monetary policy 

Lots of people are talking about what happens when the flood of easy money into emerging markets thanks to low interest rates in advanced economies like the United States slows even more than it has in the past year.

At a seminar on fiscal policy the discussion focused on the challenges facing policymakers as central banks slowly exit from unconventional monetary policy and interest rates begin rising.

A live poll of the audience found 63 percent said the global economy remains weak and unconventional monetary policies should remain in place.

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For Your Eyes Only: Three Jobs Not to Defer in 2013


David LiptonBy David Lipton

(Versions in  عربي, 中文, EspañolFrançaisРусский, 日本語)

With the New Year, we all hope to put the global financial crisis behind us. We also need to do more to secure our future.

Beyond our current economic and financial problems, there are long-term issues that we all know about, but that get too little attention in an era when policymakers are so fully engaged in slogging away at more immediate problems. Unfortunately, long-term issues unaddressed today will become crises tomorrow.

So we had better lengthen our focus, see what looms on the horizon, and do more to steer the global economy in a better direction.

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Debt in a Time of Protests


by Nemat Shafik

As the world economy continues to struggle, people are taking to the streets by the thousands to protest painful cuts in public spending designed to reduce government debt and deficits. This fiscal fury is understandable.

People want to regain the confidence they once had about the future when the economy was booming and more of us had jobs.

But after a protracted economic crisis, this will take planning, fair burden-sharing, and time itself.

If history is any guide, there is no silver bullet to debt reduction. Experience shows that it takes time to reduce government debt and deficits. Sustained efforts over many years will ultimately lead to success.

Most countries have made significant headway in rolling back fiscal deficits. By the end of next year in more than half of the world’s advanced economies, and about the same share of emerging markets, we expect deficits —adjusted for the economic cycle—to be at the same level or lower than before the global economic crisis hit in 2008.

But with a sluggish recovery, efforts at controlling debt stocks are taking longer to yield results, particularly in advanced economies. Gross public debt is nearing 80 percent of GDP on average for advanced economies—over 100 percent in several of them—and we do not expect it to stabilize before 2014-15.

So what can governments do to ease the pain and pave the way for successful debt reduction?

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iMFdirect—Our Top 10 Posts


As iMFdirect looks back at two years since our blog on global economics was launched in August 2009, we’ve compiled a list of  the posts that have drawn the most attention.

Collectively, the posts give a snapshot of some of the biggest challenges in the world economy—which because of this summer’s developments remain, in some ways, much the same today as two years ago. It’s worth noting that John Lipsky’s outlook for 2011 listed as the No. 1 downside risk to the global economy: “Renewed turbulence in sovereign debt markets could spill over to the real economy and across regions.”

From the start our aim has been to stimulate debate about global economic issues and to open up discussion, through the blog, to a broader audience. During the past two years we’ve had more than 200 posts from leading economists, including several Nobel Prize winners. Many have been reproduced by other blogs around the world and hundreds of people have provided comment and feedback, and participated in constructive debate.

Here are the iMFdirect posts that have drawn the highest number of views:

1. Ten Commandments for Fiscal Adjustment in Advanced Economies

2. Rewriting the Macroeconomists’ Playbook in the Wake of the Crisis

3. Fair and Substantial—Taxing the Financial Sector

4. 2010 Outlook: New Year, New Decade, New Challenges

5. The Future of Macroeconomic Policy: Nine Tentative Conclusions

6. Nanjing and the New International Monetary System

7. Global Safety Nets: Crisis Prevention in an Age of Uncertainty

8. 2011—A Pivotal Year for Global Cooperation

9. Warning! Inequality May Be Hazardous to Your Growth

10. Thinking Beyond the Crisis: Themes from the IMF’s 10th Annual Research Conference

Let us know what you think and subjects you would like to discuss. What would you like to see more of and what less of? We welcome your views and comments.

No Time to Waste: IMF Managing Director Christine Lagarde


by iMFdirect

The IMF’s managing director Christine Lagarde gave her first press conference today, in which she outlined three focal issues for the institution:

Our analysis of the connections between and among countries’ economies and financial sectors

The credibility of our analysis to countries must be candid and evenhanded

A comprehensive approach to our work that includes employment and social issues to help create stable economies.

Lagarde told the assembled reporters she had arrived in Washington soon after her selection because “there are many issues to address that cannot wait for a summer holiday.”

In an interview the day before, Lagarde said sovereign debt and capital flows were two of the main challenges facing the global economy.

Have a look: 

 

 

More Diversity will Help the IMF at Work


By iMFdirect

Nemat Shafik, who took over as IMF Deputy Managing Director in April, says she has been surprised by the vigor of internal policy debate at the IMF. “From the outside looking in, you have the impression that the IMF is a monolith with a very single-minded view of the world. When you are inside the Fund, what is really striking is how active the internal debate is,” she says.

At a time when the global economy is being buffeted by continued uncertainty in Europe, uprisings in the Middle East, and signs of overheating in some emerging market economies, there’s a lot to discuss. And, in addition to global economic problems, the IMF’s work environment has come under increased scrutiny, in particular how women are treated and its professional code of conduct.

In an interview, Ms. Shafik discusses some of these issues Continue reading

Global Challenges, Global Solutions


By iMFdirect

The IMF-World Bank Spring Meetings are upon us here in Washington DC.

With global challenges that require global solutions—the theme of the meetings—IMF Managing Director Dominique Strauss-Kahn reminds us that this is “not the time for complacency.”

Government ministers and officials, members of civil society organizations, journalists, and others are flocking to Washington DC this week to discuss and decide on key issues facing the global economy. Continue reading

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