IMF: Subprime Crisis May Cost Trillion Dollars
IMF, the organization which bails "countries in trouble" is in trouble itself. When IMF is ailing, would the countries be further neglected?"quis custodiet ipsos custodes?"
The International Monetary Fund on Tuesday predicted that losses stemming from the US subprime mortgage crisis could cost the global economy nearly $1 trillon.
In its biannual Global Financial Stability report, the IMF projected that falling US housing prices and rising delinquencies on the residential mortgage market could lead to $565 billion in losses. Combined with figures representing other categories of loans and securities issued in relation to commercial real estate, the consumer credit market, and corporations, losses could increase to about $945 billion.
The IMF flagged the US as the epicenter of the problem.
According to Forbes.com, the crisis is spreading beyond the US subprime market -- namely to the prime residential and commercial real estate markets, consumer credit, and the low- to high-grade corporate credit markets.
"U.S. troubles are affecting other nations' financial institutions that have the same overly benign global financial conditions and weaknesses in risk management systems and prudential supervision," the financial news site said, quoting the IMF report.
The IMF specifically warned that any industrialized country with inflated real estate prices remains at risk while "emerging market countries have been broadly resilient, so far."
Labels: IMF
posted by they lied @ 11:27 PM
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