Eurozone countries need to come out of this mess

Dr.T.V.Gopalakrishnan , mumbai , says: Yes. Eurozone countries have no choice but work together to come out of the mess.World Financial Institutions particularly IMF have to play a key and dynamic role to save the european countries and the world at large.This is where the world leaders have to exhibit their statesmanship and save the european countries. US is gradually recovering and this should help the European countries to arrive at some solution.Brics can and should come to the rescue of European economy at this critical situation.Financial institutions and the Govt should coordinate well to ensure that the international financial stability does not get disturbed too much in future by framing suitable policies and creating checks and balances.

(This appeared in ET dt/16/1/12).

Gold Reserves to the rescue of world economic crisis

The Gold price has been on the increase for the past several years and the demand for gold got an unprecedented boost since September2008when the financial crisis erupted in US.Gold became attractive as an investment avenue and storage medium from the angle of safety,liquidity and profitability.The Central banks of the world started purchasing Gold for Reserve purposes which resulted in steep increase of gold prices.Investors who speculate in commodities found an opportunity to make easy money and accummulation of wealth started purchasing gold ignoring the prices and gave a boost to gold market.Developing countries particularly India, where inflation is persisting at high level and black money circulation is very high,found gold as a best hedge against inflation and store of value.India alone imports gold on an average1000 tonnes per annum wasting the precious foreign exchange.Now the economic crisis is becoming a reality and US,Europe and other economies are finding it difficult to survive the crisis creating a panic situation.It is time for the leading institutions like world bank,IMF and central banks of advanced and developing nations to turn to Gold reserves and arrive at a solution to resolve the crisis.The World leaders have to cooperate and find some workable solution to convert gold into productive assets and rescue the badly affected economies.Globalisation integrates economies and Gold Reserves should facilitate it and resolve the economic crisis. Will it happen?

Dr.T.V.Gopalakrishnan

IMF and World Economic Stability

Dr.T.V.Gopalakrishnan (Fort worth, Texas)
13 Sep, 2011 10:51 PM
It is good to hear that IMF has proposed a set of tools financial regulators could use to detect buildup of risks that can lead to financial crisis. The IMF being an international institution set up exclusively to help its members to come out of forex and balance of payment crisis and bring in some sort of economic stability world over has a major role to play to help resolve the European and U S economic crisis. It is time IMF comes out with an innovative approach taking the support of all member countries and its own gold and other reseves to come to the rescue of US economy in particular in finding a solution for its debt crisis. The economic scenario under globalisation and integration of world economies has undergone a sea change and it is time for IMF to review its own role in the changed scenario and work towards world economic stability using its command over the entire world. The role of gold reserves in ensuring world economic stability needs to be defined and IMF which has huge reserves of Gold should be in a position to bring the much needed economic stability through out the world by converting gold into productive assets and help the nations to work as per its directives till some semblence of economic order is achieved.Time has arrived for IMF to emerge as a world leader institution to look forward to by all member countries including advanced economies.Gold Reserves of various central banks of the world also needs to be put into productive use.

(This appeared in ET E Paper dated 13/09/11).