The Beginning Of The End
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41 IMF Bailouts And Counting – How Long Before The Entire System Collapses?

Nuclear Sign And Money Symbols - Photo by CannedcatBroke nations are bailing out other broke nations with borrowed money.  Round and round we go - where we stop nobody knows.  As of April, 41 different countries had active financial "arrangements" with the IMF.  Sometimes they are called "bailouts" and sometimes they are called other things, but in every single case they involve loans.  And most of the time, these loans come with very stringent conditions.  It is a form of "global governance" that most people don't even know about.  For decades, the IMF has been able to use money as a way to force developing nations to do what it wants them to do.  But up until fairly recently, this had mostly only been done with poor nations.  But now an increasing number of wealthy nations are turning to the IMF for help.  We have already seen Greece, Portugal, Ireland and Cyprus receive bailouts which were partly funded by the IMF, Spain has received a bailout for its banking sector, and as I noted yesterday, it is being projected that Italy will need a major bailout within six months.  How long can this go on before the entire system collapses?

Well, that would depend on how much money the lender has.

And so where does the IMF get their money?

The IMF gets their money from a bunch of nations that are absolutely drowning in debt themselves.

The IMF is funded by "wealthy" nations that dominate the global economy.  The following is how Wikipedia describes the IMF's quota system...

The IMF’s quota system was created to raise funds for loans. Each IMF member country is assigned a quota, or contribution, that reflects the country’s relative size in the global economy. Each member’s quota also determines its relative voting power. Thus, financial contributions from member governments are linked to voting power in the organization.

These are the five largest contributors to IMF funding...

United States - 16.75%

Japan - 6.23%

Germany - 5.81%

France - 4.29%

UK - 4.29%

But those countries are in trouble themselves.  The U.S. has a debt to GDP ratio of over 100%.  Japan has a debt to GDP ratio of over 200%.

The truth is that these countries are funding the IMF with borrowed money.

So what happens when the contributors run out of money and can't contribute anymore?

All over the globe, an increasing number of countries are reaching out to the IMF for help.  For example, on Thursday we learned that Pakistan is getting a new bailout from the IMF...

Pakistan and the International Monetary Fund have reached an initial agreement on a bailout of at least $5.3 billion.

Pakistani Finance Minister Muhammad Ishaq Dar and IMF mission chief Jeffrey Franks announced the agreement at a press conference Thursday.

And the new government in Egypt is hoping that the revolution that just occurred will not stop the flow of IMF funds...

In recent months, a handful of neighboring countries such as Qatar have been keeping Egypt’s economy afloat by loaning the country’s central bank cash. That has bought Morsi government time to delay implementing the politically-sensitive measures the IMF has sought as a precondition before it gives Cairo a $4.8 billion credit line. In particular, the IMF had said that Egypt must raise taxes and begin phasing out fuel subsidies.

It’s not the only cash at stake. Other international donors have vowed another $9.7 billion for the country once the IMF program is in place. Roughly $1.55 billion in bilateral aid from Washington could also be held up: under U.S. law, the administration can’t loan money to countries where the military is involved in an unconstitutional change in government.

But what often happens with these bailouts is that the "conditions" that are imposed prove extremely difficult to meet.  For example, Greece has not implemented all of the "reforms" that they were ordered to implement, and so the flow of future funds may be threatened...

As Greece looks set to miss a key reform deadline set by international lenders, which could jeopardize further financial aid, a Greek government minister said it wasn't Greece's fault that it couldn't live up to the demands of a flawed bailout program.

"There are failures [by Greece],but you assume that the program that has been effectively imposed on us is perfect, which is far from the case," Nikos Dendias, minister of Public Order and Citizen Protection, told CNBC on Thursday.

His comments come after Greek finance ministry officials said on Wednesday that Greece would not meet targets on reforming its public sector by the deadline set by international lenders, putting further financial aid in jeopardy.

Once a nation gets hooked on bailout money from the IMF or from other international sources, it can be very hard to get off of it.  But that is what these globalist organizations like - they want to be able to use money as a form of control.

As we saw with Greece, sometimes a nation will need bailout after bailout.  And it appears that is also going to be the case with Portugal.  The Portuguese government is on the verge of collapsing and their financial situation is being described as "very fragile"...

Portugal had been held up as an example of a bailout country doing all the right things to get its economy back in shape. That reputation is now harder to sustain and even before this latest crisis, the International Monetary Fund reported last month that Lisbon's debt position was "very fragile".

Coming soon after the near-collapse of the Greek government, which has been given until Monday to show it can meet the demands of its own EU-IMF bailout, the euro zone may be on the brink of falling back into full-on crisis.

Right now, Portuguese bond yields are absolutely soaring and the Portuguese economy is rapidly heading into depression.

Portugal is going to desperately need the assistance of the IMF.

But what happens when the nations that primarily fund the IMF start failing themselves?

The U.S. is a complete and total financial disaster and so is Japan.  Much of Europe is already experiencing a full-blown economic depression and even China is showing signs of trouble.

So if the "wealthy" nations fail, who is going to be there to help the "poor" nations?

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  • Rodster

    IMF = The world’s new payday lenders. :P

  • Tony

    What amazes (or should I say “dis-mazes”) me is that Egypt and these other countries are desperate to borrow 5 to 10 billion dollars to keep their countries afloat. The Fed is buying 85 billion dollars worth of mortgage backed securities A MONTH to prop-up housing in the US.

    $85 BILLION!!!!! A MONTH!!!!

    The Marshall Plan to rebuild Europe after WW II was roughly 130 billion in today’s dollars. The entire Apollo Program? $ 170 billion in today’s dollars.

    This is all going to end very badly.

    • Hammerstrike

      The thing is, they don´t create wealth, they only take it from those that do.

      Borrowed prosperity of country A means poverty for country B.

      Yet the medias insist that trade between country A and country B is what keeps the peace.
      There are really no reasons for country B to lend to A, except global trade stability.

    • carlcasino

      This is what we get when we elect Politicians .If we elected Joe the plumber or an ex-military we might get some semblance of sanity in govt. [exclude McCain] he has been corrupted by the “K” street crowd.

  • MeMadMax

    Can you say ponzi scheme?

    • Mondobeyondo

      I suppose I could, but there’s no Greek translation for it. Best I could do is “baklava”.

  • markthetruth

    Rube Goldberg Economics

    the end…

  • Gkjohn

    None dare call it a Conspriacy.

    • Hammerstrike

      But that is exactly what it is.

  • markthetruth

    Americans do have useful Talent look at “Jaws” he could eat 69 hotdogs in 10 minutes.

    the end…

    • Hammerstrike

      The end of the beginning…

  • Hammerstrike

    Screw the IMF, with an electrified screwdriver which screw is wrapped in rusty barbed wire.

    Hopefully, countries will start cutting IMF fundings to cut costs.

    Once a major player do that, rising cost for everyone else brings others to cut it too, w00000000000t!!

  • Mondobeyondo

    I love the analogy!!

    Nation #1. “How much money you got to bail us out?”

    Nation #2? “We’re flat broke! And you?”

    Nation #1: “Ummm.. why do you think we’re asking YOU for help?”

  • Graham

    In today’s world, which country most closely fits the description of this “Babylon”?

    • Peter Mwariri

      AMERICA

  • MichaelfromTheEconomicCollapse

    Unfortunately, there have been some people that have chosen to write false things about me and post them on the Internet. Normally I would ignore such things, but they have caused some confusion among some of my readers. So I have decided to set the record straight.

    Who Is Michael Snyder?…

    http://theeconomiccollapseblog.com/michael-snyder

    Michael

    • chilller

      Thanks for the bio Michael! Your path crises-crosses ours. We lived in Idaho and now near UVA.
      Being a predator (wolf) by nature, I’m happy to eat all of the little chickens pecking at you.

      • MichaelfromTheEconomicCollapse

        The Charlottesville area is so beautiful. I still miss it sometimes. :)

        Michael

        • chilller

          It’s very nice. Don’t know where in ID you are but we were in Idaho City, north of Boise…God’s country. Idaho is one of the best kept secrets out there…”only potatoes…nothing to see here folks…keep moving…”

    • RarefiedSnotress

      Mike, I’m glad you posted a link to your bio.

      It was good to see an old picture of you with your wife because it allays my fear that you might be a gay misogynistic chauvinist when you publish articles like “32 Facts That Show How Men Are Being Systematically Emasculated In America Today”

      Thanks for setting the record “straight”.
      btw.. what, no pics of the kids?

      • jerry longpecker

        Did you read the article and the links dipshit? I can feel your total brainwashed ignorance from here.

        • RarefiedSnotress

          ahh.. here’s the moronic misogynist set now.
          now, mr.longpecker.. surely you have something better to do with women than call them nasty names.

  • JailBanksters

    These countries would be better off going to the Gambinos for a Loan than the IMF. At least they don’t take away your means of making money to meet their stringent repayment plans.

  • Dave Webb

    This shuffling of currencies has been going on since prior to WWII.
    Britain is a classic example of a failed economy based on socialism and communistic economic values.
    Economics based on spending money to keep money in circulation. Yes it has been going on for a very long time. It is basically fed by devaluing currencies until they all look like bad deals.
    The entire planet is involved in this kind of economics.

    Picture a chess game with all the pieces. Have a game. Then put the existing pieces at the end of the game back. Those not eliminated by the game.
    Then have another game. Not fair right? Now change the game to monopoly and start over with all the monopolies on the board.
    The RIch get richer and the poor remain poor in such an environment. And as the money is absorbed by the Rich the poor have less resources to work with.
    Now eliminate the need for as many workers. At the turn of the century somewhere around 1903 we had many trades and many craft organizations. Then the assembly line came along and eliminated a lot of the trades. It took about 20 years but the depression was the result.
    In the late 80s, PCs eliminated a number of trades with word processing, spreadsheets, automated procedures in toolmaking, and the list goes on and on.
    By the 90s, unskilled and skilled labor started being eliminated with cheap help because of the use of the Internet.

    This is going to cause a depression like none we have ever seen in the past. And the leaders appear to be clueless.
    That is why huge numbers of people are nonproductive and on various social welfare programs. It isn’t just here. This revolution of automation is as bad as the results of an assembly line on an economy. Thus recycling money into the economy from the rich. It isn’t really working.
    Within the year, the entire world economy could come crashing down around our heads. When that happens look out.
    The parasites in charge have already figured out that they need to leave like rats deserting a sinking ship. The question is where are the rats going?
    I do not think any place will be safe not even Switzerland(the traditional escape country.)
    My own suggestion is surround yourself with farmers willing to trade work for food. Lots of luck with even that deal.

  • chris

    Based on this the mother of Babylon who has the symbol of the LION can only be the UK surely.
    But is Russia a moslem nation?

  • Orac4Prez

    USA = Land of the Free Money.

  • toadsticker

    The reset button used to be war, however, now people have become wise to this scheme and don’t want to send their kids to die for some made-up nationalistic BS. Why do you think the Mayan Empire just dissolved? The people tried to live by the rules to keep their community and extended families together. However, after years and years of putting up with the leaders sacrificing their children and taking more and more of their produce they got fed up with the mystical manipulation and simply walked away from the relatively small city-state.
    Today we live in a global system that we cannot just get up and walk away from. People are leery of war set upon them by lying leaders so now those leaders are trying to set up a new way to perform the reset and get people to somehow go along with complying to their own death sentence. Like the Jews in Germany who loaded themselves on to the trains because of a BS manipulation.

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