IMF doubles its lending firepower

The IMF says it has received firm commitments of more than $430bn.

The money is to help economies in trouble and includes just under £10bn ($15bn) from the UK in loans to the International Monetary Fund (IMF).

It is part of a global effort to bolster the fund's lending capacity, which IMF managing director Christine Lagarde wanted to increase by $400bn.

The money doubles the fund's firepower which threatened to become overwhelmed by the eurozone crisis.

Australia will contribute $7bn, Singapore $4bn and the Republic of Korea $15bn.

The IMF's managing director, Christine Lagarde, said that some countries including Russia, India, China and Brazil had made private pledges but did not want to go public until they had discussed the pledges back home.

In a joint statement following the meeting in Washington, the IMF's International Monetary and Financial Committee (IMFC) and the G20 finance ministers and Central Bank governors said: "There are firm commitments to increase resources made available to the IMF by over $400bn in addition to the quota increase under the 2010 reform."

"These resources will be available for the whole membership of the IMF, and not earmarked for any particular region."

The eurozone as a whole is contributing $200bn of the total and Japan is another major supplier of funds and is lending $60bn.

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Analysis

Andrew Walker BBC World Service Economics correspondent at the IMF meeting

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The IMF has doubled its lending capacity. But first it will have to borrow the money. The agreement enables the IMF to borrow an extra 430 billion dollars. It can lend that to other member countries in financial stress. The aim is global financial stability ad a sounder footing for the world economic recovery. What that means in practice is the IMF is getting a very large hose to douse the financial fires in the eurozone, if they threaten to burn out of control. Even then, it is probably not big enough for the worst the eurozone could face. The money is not specifically tied to the euro crisis and it is certainly not for the exclusive use of the countries using the currency. But if there were no euro crisis, the IMF would not have been passing round the hat.

UK Chancellor George Osborne said the loan was important to the UK: "It's in Britain's interest that we have a stable and strong world economy - that creates jobs in Britain."

He added that any loan made would bring in a return in the form of interest.

He can lend up to £10bn without parliamentary approval. He had some room for manoeuvre because parliament has previously approved £40bn of loans, of which only £30bn has been committed.

But this latest pledge is unpopular with some members of Mr Osborne's Conservative Party, who had been urging him not to sign up to an increase.

Backbench MP Peter Bone described the decision as "bonkers", describing any efforts to prop up the eurozone as a waste of time.

The UK's shadow chancellor, Ed Balls said: "The IMF cannot and should not become the de facto central bank of the euro area.

"The IMF is being put up to step in and play the role that the European Central Bank should be playing - a strategy which cannot work and is self-defeating by highlighting the lack of a proper ECB firewall."

The UK Treasury pointed out that no country has ever lost money lending to the IMF in its 67-year history.

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Commitments so far

• Euro area: $200bn
• Japan: $60bn
• South Korea $15bn
• UK: $15bn
• Sweden: $10bn
• Norway: $9.3bn
• Poland: $8bn
• Australia: $7bn
• Denmark: $7bn
• Singapore: $4bn

Source: IMF. Some figures are approximate

It says its contribution to the IMF is not public spending. All UK loans to the IMF are financed from the UK's Official Reserves, remain UK assets and do not contribute to public sector net debt.

The UK's move was welcomed by the head of an important House of Commons committee of MPs.

Andrew Tyrie, chairman of the Treasury Committee, said: "This is not just sensible, it is essential.

"The IMF is the only fire-brigade available to the global economy. It is vital that the IMF has the necessary tools to deal with the current eurozone crisis and the risks to wider global financial stability."

Target

There is still a question about what other major economies will do.

Brazil wants to have a bigger say in running the IMF in return for a commitment of extra money, while the US is not likely to offer any money because doing so would attract criticism at home in a presidential election year, according to BBC economics correspondent Andrew Walker.

Brazil said the US and Europe dominated the IMF and that meant IMF policies favoured the two blocs.

Brazil's voting power is the same as the Netherlands and smaller than Spain, Italy and the UK's, although the Brazlian economy is bigger than all of these.

Its finance minister, Guido Mantega, said emerging countries - including his - were "paying a high price" for the loose monetary policies of advanced economies that had been endorsed by the IMF.

He said though that they would also contribute further to the fund to help reach the desired target of $400bn: "It's likely that we will reach an agreement around $400bn to increase IMF resources."

He said who would give what would be decided in principle by the next (G20) meeting in Los Cabos in Mexico two months from now.

Russia's deputy finance minister Sergei Storchak has already said that his country will offer $10bn and that he is confident that the IMF will reach its funding target.

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What is the International Monetary Fund?

Committing the extra money does not mean it will actually need to be loaned.

The German finance minister Wolfgang Schaeuble, said the extra funds were a sign of international co-operation: "The Europeans have done what they have promised, what we had agreed on.

"We [the G7 leading developed nations] agreed that the debate on IMF resources has to be brought to an end here. That is not a sole European issue."

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Three Reasons To Set Up A Unique Business Email Address

If you bought a domain name, you've hired someone to build you a site and you've got a website for your business online and ready to go.

Your online business is now all set for the digital world right?

Wrong.

If you haven't set your company up with at least one dedicated email address with the same details as your domain then you can expect most of the credibility you have for creating a website goes out the window.

The good news though is that setting up a business email doesn't cost anything, only demands tools that you already have at your fingertips and is incredibly easy to do.

So why should you set up a business email to match your domain?

Here are three reasons why setting up a business email is not only important but it should be something that you do immediately now that your website is operational.

Reason One: it enhances your company reputation online

As I hinted at in the introduction having an email address from a free provider as your business email address can really hurt your reputation.

The reason, is phishing.

This is the practice of using an email address very similar to a reputable business' to obtain people's passwords, personal information and login details to bank accounts.

Phishers loved to use free accounts with variations on trusted user names (NZpaypal, westpacservice etc) a few years ago to get their hands on people's personal details.

They haven't done that for a while now, largely because it stopped working, which makes some pretty strong cases against you using the same type of email address for your business.

Reason Two: you can be more flexible with your internet service providers

Internet Service Providers are wonderful companies that reward long business relationships with better rates and service. Right?

Wrong, when it comes to screwing the average business/personal customer the average Internet Service Provider is only too happy to screw the long-standing sucker out of more of the services that they have already paid for and more of the money that the customer has gone a long way to try and earn.

But if your business email uses their email hosting service (like @aol @orange etc) then you will either have to contact all of your customers and hope that they don't invariably use your old business email address or grin and bear the higher cost of doing business with your current ISP.

Reason Three: get different email addresses for different purposes

Each business have different parts.

You might sell products, consult people on how to use your products and train people in a particular line of work.

By getting an email network that matches your domain you can have a shop [at] yourbusiness consulting [at] yourbusiness and seminars [at] your business address in as little time as it takes to read this paragraph.

As you can see business emails are highly useful for any business.

And the best part of it all is that if you have already set up your site then setting up an email is free quick and easy.

Make the switch over to business emails today, you won't regret it.

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Mining Your Own Business

I cannot count all the "opportunities" I have been presented with in the mining sector of the diamond business. I was a past Vice President and board member of Sao Luis Mining, a publicly traded mining company out of Brazil. It took us years to lose our money, but in the end, we were successful in doing just that.

All of us in the venture were experienced in diamonds, mining, finance and public offerings. Despite our many talents and skills we were unable to take a property with a large supply of diamonds and make a go of it.

Why we failed is a book in itself. I won't bore you with the details. What I will do, is give you an overview as to what is involved in putting together a mining operation and it will be self evident why there are so few successful mining operations.

We spent years completing our environmental studies, getting our licenses, permits, geological reports, assays, financial feasibility and cost and income reports. It was a never ending cycle of stop and starts, ups and downs; all the while the money is flowing out like the Amazon into the ocean.

The other money eating monster is one that cannot be considered in your projections. It is commonly referred to as the 'X' factor. This is when something goes wrong that no one could have imagined. Except that it happens far more often then even the most pessimistic person could imagine.

Just as an example, the DMS or Dense Media Separation Machine a $600,000 beauty is made in South Africa. When you ship this monster (see picture) you need to tell the truck driver not to go faster than 3-5 miles an hour down your unpaved road or you can destroy the insides. (It will be out of balance) Wait until you see how much fun you can have trying to get it repaired in your remote location. You will roar with laughter when they tell you how long it will take to get the parts and how much this small problem is going to cost you. Good times had by all!

Because you are nearly always working in a third or forth world country, you can expect that everything will take three times as long as projected and will cost two to three times as much as you were told it will cost. Most companies fail because they run out of money before they have a chance to be successful. Other companies fail because the owners just get sick and tired and no longer wish to sit in the bush with the bugs, snakes and local bandits, some of whom wear uniforms, ties and suits.

There are a million reasons why a mining operation will fail. There are few companies who have the knowledge and resources, both human and financial to succeed. To do a mining operation properly, it will take approximately $7-12 million investment and two to three years.

There is an exception to this rule. If you have a concession and you have enough money to buy a pan and some camping equipment and food supplies, you can make a good living going into the mud yourself for a few months at a time. It is not a romantic as having a publicly traded diamond mining company, but you have a better chance of making money.

Article Source: http://EzineArticles.com/6893366

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