Defaulting banks - where will it stop?

[Jan Klimkowski]

'It seems very pretty,' Alice said when she had finished it, 'but it's rather hard to understand!' (You see she didn't like to confess, ever to herself, that she couldn't make it out at all.) 'Somehow it seems to fill my head with ideas--only I don't exactly know what they are!

Through the Looking Glass and what Alice Found There, by Lewis Carroll

IMF poised to print billions of dollars in 'global quantitative easing'


The International Monetary Fund is poised to embark on what analysts have described as "global quantitative easing" by printing billions of dollars worth of a global "super-currency" in an unprecedented new effort to address the economic crisis.


By Edmund Conway
Last Updated: 3:39PM GMT 13 Mar 2009

Alistair Darling and senior figures in the US Treasury have been encouraging the Fund to issue hundreds of billions of dollars worth of so-called Special Drawing Rights in the coming months as part of its campaign to prevent the recession from turning into a global depression.

Should the move, which is up for discussion by the summit of G20 finance ministers this weekend, be adopted, it will represent a global equivalent of the Bank of England's plan to pump extra cash into the UK economy.

However, economists warned that the scheme could cause a major swell of inflation around the world as the newly-created money filters through the system. The idea has been suggested by a number of key figures, including billionaire investor George Soros and US Treasury adviser Ted Truman.

Simon Johnson, former chief economist at the IMF, said: "The principle behind it is that everyone would get bonus dollars and instead of the Federal Reserve having to print them, everyone gets them.

"The objective is to create a windfall of cash. However if everybody goes out and spends the money it could be very inflationary."

http://www.telegraph.co.uk/finance/finan...asing.html

"I can't believe that!" said Alice.
"Can't you?" the Queen said in a pitying tone. "Try again: draw a long breath, and shut your eyes."
Alice laughed. "There's not use trying," she said: "one can't believe impossible things."
"I daresay you haven't had much practice," said the Queen. "When I was your age, I always did it for half-an-hour a day. Why, sometimes I've believed as many as six impossible things before breakfast."

Through the Looking Glass and what Alice Found There, by Lewis Carroll