IMF: Europe Remains in Trouble; Worsening Problems Can Degenerate into Wars and Undermine Democracy

Dominique Strauss-Kahn, the IMF's Managing Director, said today in Geneva that Europe remains in a troubling situation and that the effects of the global financial turmoil are far from over.

“The situation in Europe remains troubling and the future is more uncertain than ever.”

According to Bloomberg, he says Europe “needs a coordinated economic policy and we have not reached that level yet,”
[...] the situation of the U.S. “is less certain” than other regions, indicating it will be necessary to see how the fourth quarter pans out".

Strauss-Kahn called for a supervision of the financial sector “that is not afraid of saying no to powerful interests.”

Won't that be the banks? Is that going to happen?

"The financial sector has to shoulder a substantial yet fair share of the costs that risk-taking imposes on the economy". He alludexd to the tax on financial activities proposed by the IMF that has so far been without success.

“There is no certainty whatsoever that if a similar crisis occurred, that parliaments would be prepared to cough up billions to save the financial system [...] Are taxpayers going to be ready to finance such a thing? It’s uncertain.”

Troubles undermining democracy and can degenerate into wars

“Today, as in the past, when economic and financial problems worsen, they upset the social balance, undermine democracy, weaken trust in institutions, and can degenerate into war, civil or foreign, Making global economic governance more legitimate means policy makers “are working for peace.”