As far back as May 2009 the key future role of the IMF as lender of last resort to failing government finances and weakened private commercial banks was highlighted by IMF members approving a sudden jump in future resources to $ 500 billion, following the proposal for that jump made only one month before, at the April 2009 G20 meeting. Of this, the Obama administration would pledge $ 100 billion. Separately, the IMF would issue - that is print - additional SDRs or special drawing rights to a total of $ 250 billion in exchange value, that is SDRs exchanged for US dollars as and when needed.
Overall these actions would increase lending power of the IMF by $ 750 billion. We can note that in 2006, total IMF whole-year operations were less than $ 1 billion in exchange equivalent.
Overall these actions would increase lending power of the IMF by $ 750 billion. We can note that in 2006, total IMF whole-year operations were less than $ 1 billion in exchange equivalent.
To be sure these amounts may be massive, but they run behind the debt-and-deficit crisis of governments, and the closely-related crisis of the supposedly "still in recovery" and restructuring private bank system. This has its own lender of last resort - the Bank for International Settlements or BIS in Bale, Switzerland.
The debt and bank failure crisis is far more massive than what the IMF can get its hand on in the way of gold reserves, or dares to print as SDRs. US Federal debt has grown by about $ 3 600 billion from December 2008 to April 2011, to more than $ 14 500 billion or close to 98 percent of US economic output. European government debt growth since Dec 2008 is probably close to, or larger than this. Asian OECD countries led by Japan in debt terms have also suffered runaway debt growth. Global debt growth and therefore search for liquidities since end-2008 is likely at minimum $ 25 000 billion, almost exactly one-half of world annual GDP today".................LINK
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