Beware the IMF

While the IMF speaks with the gravity of a government organisation, it must be remembered that they are essentially a commercial operation servicing governments. Beware their rhetoric…

A case in point was last week when a spokesman warned the Greek debt swap would fail without 100% private sector participation (not including the IMF of course!). Here they are just talking their book – the less private sector debt, the greater the chance that the IMF gets repaid.

Borrower nations know full well that IMF loans are expensive (oh, the fees would make a banker smile!) and draconian. No wonder that nations such as Korea, Thailand, Indonesia and a host of others refinance their IMF loans as soon as possible.