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IMF to US: Do Something NOW

Monetary fund chief pressures Congress to pass bailout, Europe to make plans

By Rob Quinn, Newser Staff

Posted Oct 1, 2008 7:30 AM CDT

(Newser) – The US must act swiftly to avoid economic meltdown and Europe's banks need to be ready with emergency plans of their own, IMF's managing director warns. European and Asian markets have bounced back on the prospects of a revived US bailout deal, but JP Morgan analysts warned yesterday that Europe's banks face another $45 billion in losses before the end of the year, the Guardian reports.

The IMF forecasts a gradual, "U-shaped" recovery for the US economy next year—but only if the bailout plan is passed quickly by Congress. "We're right at the moment where action is needed," IMF chief Dominique Strauss-Kahn told Reuters. "A non-perfect plan is better than no plan at all."

[Images (3)]

[Quotes (1)]

A passer-by in Times Square is reflected on the studio window of the NASDAQ Marketsite as he looks inside to the Market wall Tuesday, Sept. 30, 2008, in New York. (AP Photo/Julie Jacobson)

Men, backdropped by central London's landmark Tower Bridge, walk on a bridge near the city's financial center, Tuesday Sept. 30, 2008. (AP Photo/Lefteris Pitarakis)

Jeremy Conroy, 13, sells apples in front of the New York Stock Exchange Tuesday, Sept. 30, 2008 in New York. Conroy is reenacting a scene of boys selling apples during the Great Depression. (AP Photo/Mark Lennihan)

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We still do not see a deep downturn and project a recovery next year. But we also do not see a V-shape where you go down and recover rapidly.
- IMF managing director Dominique Strauss-Kahn

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IMF to US: Do Something NOW