Thursday, October 11, 2012 – by Staff Report, Daily Bell
Why the IMF has got it so hopelessly wrong on the euro crisis ... David Cameron and George Osborne are not for turning, but the International Monetary Fund is plainly made of flimsier stuff. The latest flurry of economic analysis from the IMF – to coincide with the annual meeting in Tokyo – has revealed a not so subtle change of heart over fiscal austerity. – UK Telegraph
Dominant Social Theme: It is very necessary to raise taxes and cut deficit spending to create a responsible recovery.
Free-Market Analysis: The Telegraph's
We are not so adept at reading certain tea leaves (the IMF's, for instance) as Warner seems to be. But he does make a case – and if correct, it would fit into some larger projections we've been making for years as well...
In an (preferable) alternative universe, the EU's southern PIGS would devalue in order to recover some level of economic vitality. But they cannot devalue. They are stitched to the euro and the European Central Bank that would have to devalue for all if it devalues for a few.