The IMF raised the global growth estimates today, the first time since 2011.
In its statement it said, the global lending organization said in its latest economic report that the American economy should expand 2.1 percent this year. Europe is likely to shrink 0.3 percent and the world economy should grow 3.5 percent. All three of the I.M.F.'s estimates are slightly better than its January's forecasts.
This in my opinion is complete hogwash! A very sorry attempt at trying to gloss over the global growth problems. Christine Lagarde, the head of the IMF has tried every trick in the book from asking the developed world, to the middle east and the BRIC nations to try to shore up Europe's mounting debt crisis. And now she and the IMF have decided to come out with completely bogus forecasts that are not grounded in fact but in fantasy.
Here are the facts:
China just posted weaker growth than estimated.
India last night cut rates as it is wary of a slowing economy.
Debt austerity is causing European economies to post negative GDPs.
US GDP for 2011 grew at 1.7% and quite a few of us in the hedge fund circles are calling for the US to return to recession later this year or early 2013.
So the question for the IMF is where are the facts to back up their rosy claims for increased global growth?
It is extremely sad to see that another global institution is about to join the ranks of global central banks who have lost all credibility in the eyes of investors.