BIS Annual Report: The unsustainable has run its course and policymakers face the difficult task of damage control

30.06.08 - 13:05 ... source : Bank for International Settlements (BIS)

... 30 June 2008 The fundamental cause of today's problems in the global economy is excessive and imprudent credit growth over a long period, says the Bank for International Settlements (BIS) in its 78th Annual Report released today. This always threatened two unwelcome outcomes: a rise in inflation and an accumulation of debt-related imbalances which would at some point prove to be unsustainable. In the event, both unwelcome phenomena are being experienced at the same time. Leaning against current inflationary pressures should imply a significantly less accommodating bias to global policy overall, even though this could create some short-run difficulties in some countries. The BIS notes that th ...» Next (HTML)