[Source:livemint.com]
Talking to select mediapersons on the sidelines of a lecture on “Lessons from the Financial Market Crisis: Priorities for the World and the IMF”, organized by the Indian Council for Research on International Economic Relations (Icrier), Kahn is concerned that the US downturn could cut emerging economy growth by close to 1%. Edited excerpts :
On advocating fiscal contraction before and fiscal stimulus now.
The main tool for the IMF has not been its lending capacity but what Keynes called “ruthless truth telling”. The US sub-prime crisis has indeed been a failure of supervision and regulation and they have to correct it. The IMF cannot work to change the US economy or the world economy, but will hopefully carry out some work of importance. We have an even-handed approach. If the US economy goes through pain, the world goes through some pain. A downturn in the US economy would have a lot of consequences, even with a lag.
No comments:
Post a Comment