Tales of the Economic Hitmen of the IMF

[RE]

The IMF is up to its old tricks doing to Nation-States what your local banks do to you the Konsumer and McMansion dweller and the TBTF Banks do your city, turning you into debt slaves with all the property you "own" held as collateral for money they loan you to pay the dentist for your child's braces and to help her with her college tuition or for the chemo you need for your cancer trreatments that's not covered by your insurance policy.  So just like when you lose your job due to your employer going BK after defrauding his investors and retiring to live in luxury in the Cayman Islands with his A-list Vagina companions, the bank repos everything you own and you move into a tent on Skid Row, the IMF forecloses on the country and privatizes everything from the water works to the power grid.

The latest victin of the Economic Hitmen from the IMF is home to the Great Pyramid at Geza and the Sphinx, soon to be auctioned off at Sotheby's to pay Egypt's ever growing pile of debt, since apparently they're not selling as many sheets made from Egyptian Cotton as they need to pay for new Teslas and upgrading their power grid to handle the load.

Hence, the IMF, much like a central bank acting towards a commercial bank, continues to fulfil its critical commitment as the international lender of last resort to Egypt. And for the time being, the country is being managed like a bankrupt bank. The ever-growing external debt threatens the Sisi government's control over its financial and real assets. These assets essentially act as collateral for the public debt, meaning that they could be seized in the event of a default. And the harsh reality is that Egypt's financial well-being isn't just about the nation itself; it's about safeguarding the purely financial interests of its key creditors, international lenders and top Gulf donors.

Where does all that money the IMF loans to these countries come from, and how come the IMF is never in danger of going BK after loaning endless money to countries that can never pay off the loans?   When were they elected as global lender of last resort to the world?  Who are the loan offices who decide how much money they will loan to a governement?  Who hires the loan officers and assigns them to a particular country?  Who owns the IMF and where is the stock traded?

I'm sure you know the answer to these questions.  Everybody Knows.  "They" own it.  It's a club, and you're not it it.

https://www.middleeastmonitor.com/20240321-bills-and-bailouts-the-bankruptcy-management-of-egypts-economy/

Bills and bailouts: the bankruptcy management of Egypt's economy

RE

[Knarf]

Egypt just joined BRICS. I wonder if that will reshape their economic future?

Pi:

Egypt has shown interest in becoming a member of the BRICS economic bloc. In fact, Egypt officially joined BRICS on January 2, 2024, after its membership was approved by the House of Representatives.
Egypt's interest in joining BRICS is motivated by the potential economic benefits of membership, including increased trade and investment opportunities with other member countries. The volume of trade exchange between Egypt and BRICS countries has already been increasing, with exports from Egypt to BRICS countries growing by 5.3% in 2022.
Additionally, Egypt's membership in BRICS may provide access to the New Development Bank, which has been established by BRICS countries to fund infrastructure projects and promote economic development.
Overall, Egypt's membership in BRICS is seen as a positive step towards strengthening its economic ties with other emerging economies and promoting economic growth and development within the country.

[RE]

Egypt just joined BRICS. I wonder if that will reshape their economic future?

Pi:

Egypt has shown interest in becoming a member of the BRICS economic bloc. In fact, Egypt officially joined BRICS on January 2, 2024, after its membership was approved by the House of Representatives.
Egypt's interest in joining BRICS is motivated by the potential economic benefits of membership, including increased trade and investment opportunities with other member countries. The volume of trade exchange between Egypt and BRICS countries has already been increasing, with exports from Egypt to BRICS countries growing by 5.3% in 2022.
Additionally, Egypt's membership in BRICS may provide access to the New Development Bank, which has been established by BRICS countries to fund infrastructure projects and promote economic development.
Overall, Egypt's membership in BRICS is seen as a positive step towards strengthening its economic ties with other emerging economies and promoting economic growth and development within the country.

Definitely if the country gets the Chinese to invest in projests or businesses in their country, that would make a big difference in terms of job opportunities and what kind of produucts they might be able to export.  Given the Chinese have their own economic problems at home though, it's not clear how much they are willing to invest in other countris.  How would it benefit the Chinese?  Also, they wouldn't want to finance a competitor in a market they are strong in.  Why would they make microchips in Egypt to compete with chips they make in Guangzou?

If they get a lower interest rate for money from BRICS or a longer repayment schedule, that would of course help.  IMF money also always comeswith restrictions on how it is used and who gets paid first with it.  If the BRICS money has fewer restrictions, that also helps.

However, more loan money doesn't solve systemic balance of payments proglems..  If stuff the country needs to run like their power grid and their water works and their import costs for food, fertilizer, machinery etc that they need and can't produce enough of themselves is more than they can earn through exports, it doesn't matter who loans them money, they'll still keep digging a deeper and deeper hole.  The fact is that no industrialized country really runs at a profit anymore, that's why they all have ever increasing debt loads growing.  The main difference is that developed countries can issue their own debt which the TBTF Banks will buy as long as it comes with Investment Grade ratings.  Despite the fact the FSoA has to borrow more and more money every year to operate, the magical belief persists that it will never go bankrupt.  We can always pay our debts because we can always borrow more money from ourselves to pay those debts.  Of course it sounds crazy because it is crazy.   Small countries can't do this, they're not TBTF.  The FSoA is TBTF.  China is TBTF.  Japan is TBTF.  Germany is TBTF.  If any TBTF country actually did default on its bond obligations, the whole House of Cards would come tumbling down.  Even when it happens to a small country like Greece it causes huge problems in the banking system, which is why the IMF keeps loaning them more money.

One of these days, the whole system will just seize up, like an engine with no motor oil greasing the cylinders.  Magical thinking can't last forever.

RE