Two weeks ago, we when we disclosed the most recent expansion in the IMF's funding with the announcement of the activation of a "Special Funding Pool" we predicted: "Bottom line: there is a new threat to the international monetary system which means Europe May 2010 redux is imminent. US taxpayers: our condolences." Alas, as tends to happen in these cases, we were right. The IMF, whose number one source of funding is you, dear US taxpayer, has just received a bailout request from Portugal.
From the IMF:
Mr. Dominique Strauss-Kahn, Managing Director of the International Monetary Fund (IMF), issued the following statement today on Portugal:
“The IMF has received a request for financial assistance from the Portuguese authorities and we stand ready to join the effort, together with our European partners, to help restore growth and financial stability in Portugal.
“We are prepared to move expeditiously on this request and hold swift discussions with the Portuguese government, together with the European Commission and the European Central Bank, on an economic program, supported by the main political parties, that could provide the basis for Fund financial assistance.
“We also welcome today’s statement from the Eurogroup and ECOFIN ministers indicating that preparations will start immediately to reach agreement on a program that will help Portugal meet the economic challenges it is facing.”
As a reminder, here's who foots the bill. Good luck getting a post catastrophe Japan to give money to the bail out fund.
Muito obrigado gringos.