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IMF Employees Fear Jub Cots, End Of Perks

Sun Dec 18, 2005 3:30 pm

I thought this was kind of funny.

"Several IMF officials in Washington have expressed off the record their worries that the payment in full of 15 billion dollars by Brazil and 10 billion dollars by Argentina, effectively ending any debts those countries incurred with the agency (a first in history), will lead to the end of first class jet travel, five star hotel stays, or worse: job cuts and pension slashes.

The IMF, in lay terms, makes money by lending money to countries and recovering the money later with significant interest. Brazil and Argentina were two of the biggest 'clients' of the agency. Now both countries in an unprecedented move will pay off in full and in one swoop their entire debts, robbing the IMF of billions in interest that would have otherwise been accrued. In essense, the IMF was largely funded by countries like Argentina and Brazil.

With that money gone, the IMF may have to downsize dramatically, and quite soon, perhaps as early as 2006. They may need to purchase US bonds to finance themselves, but that would create inevitable conflicts of interest when annual reports on the US economy by the IMF were to be issued. And if other countries decide to do the same as Brazil and Argentina, things could get even uglier..."

Poor IMF.
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