Scandal At The IMF: Senior Economist Resigns, Says "Ashamed To Have Had Any Association With Fund At All"

Tyler Durden's picture

The rats everywhere are now jumping furiously off the titanic, but few had taken the time to write a letter explaining in detail just how cracked and broken the hull really was. This has now changed, with the departure of Peter Doyle, formerly a division chief in the IMF’s European Department responsible for non-crisis countries and currently an adviser to the Fund. Not content with quietly slinking off the scandal ridden organization which has become the butt of all jokes in the international community, where humor about Lagarde's Louis Vuitton panhandling bag is as pervasive as punchlines about just how incompetent the organization is at actually doing its duty, Doyle has penned the following scathing letter which tears down every myth about the IMF: from its impartiality, to the selection process of its head, to its effectiveness. The letter also contains the following gem: "After twenty years of service, I am ashamed to have had any association with the Fund at all." Pretty much says it all. This is a scandal in the making, and one which may shake to the core the credibility of the IMF in the context of international organization.

Full letter (pdf)

European Department
Washington DC
June 18, 2012


To Mr. Shaalan, Dean of the IMF Executive Board

Today, I addressed the Executive Board for the last time—because I am leaving the Fund.

Accordingly, I wanted first to formally express my deep appreciation to the Swedish, Israeli, and Danish authorities with whom I have worked recently, as well as all others with whom I have worked earlier, for their extraordinary generosity towards me personally.

But I also wanted to take this opportunity to explain my departure.

After twenty years of service, I am ashamed to have had any association with the Fund at all.

This is not solely because of the incompetence that was partly chronicled by the OIA report into the global crisis and the TSR report on surveillance ahead of the Euro Area crisis. Moreso, it is because the substantive difficulties in these crises, as with others, were identified well in advance but were suppressed here. Given long gestation periods and protracted international decision-making processes to head off both these global challenges, timely sustained warnings were of the essence. So the failure of the Fund to issue them is a failing of the first order, even if such warnings may not have been heeded. The consequences include suffering (and risk of worse to come) for many including Greece, that the second global reserve currency is on the brink, and that the Fund for the past two years has been playing catch-up and reactive roles in the last-ditch efforts to save it.

Further, the proximate factors which produced these failings of IMF surveillance—analytical risk aversion, bilateral priority, and European bias—are, if anything, becoming more deeply entrenched, notwithstanding initiatives which purport to address them. This fact is most clear in regard to appointments for Managing Director which, over the past decade, have all-too-evidently been disastrous. Even the current incumbent is tainted, as neither her gender, integrity, or élan can make up for the fundamental illegitimacy of the selection process. In a hierarchical place like this, the implications of those choices filter directly to others in senior management, and via the appointments, fixed term contracts, and succession planning of senior staff, they go on to infuse the organization as a whole, overwhelming everything else. A handicapped Fund, subject to those proximate roots of surveillance failure, is what the Executive Board prefers. Would that I had understood twenty years ago that this would be the choice.

There are good salty people here. But this one is moving on. You might want to take care not to lose the others.

cc. Ms. Nemat Shafik
Mr. Stanley Fischer
Mr. Stephan Ingves
Mr. Benny Andersen
Mr. Alex Gibbs
Mr. Eric Meyer
Mr. Amit Friedman
Mr. Martin Holmberg
Mr. Reza Moghadam
Mr. Mark Plant
Mr. Brad McDonald

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tmosley's picture

Watch out for the "evaporative cooling" effect of those who are left.

Even as the rats flee the sinking ship, those that are left will become ever more fanatical, until and unless immediate action is taken to disrupt this process, starting with a wholesale replacement of the upper echleons of their staff.  I won't hold my breath.

onebir's picture

Thought provoking link :)

I don't think this guy left because of fundamental disagreements about how the global economy works, or what the IMF should be doing though. He seems to have been upset that they weren't doing what they should have been doing properly for political reasons.

So I'm not sure how the arguments in the link apply here...

tmosley's picture

I am of the opinion that Keynesianism is analogous to a cult, hence the connection.

g speed's picture

re the link---just a new way of thinking about an age old system of consolidating power-- 

catacl1sm's picture

This is EXACTLY how we end up with retards in Congress and sociopaths as CEO's.

SoNH80's picture

If I were him, I wouldn't:

(1) Jog in Rock Creek Park at night

(2) Go sailing in the Chesapeake Bay in February, and fall overboard after having a heavy anchor chain wrapped around him, and a shotgun shell bored into his skull

(3) Abandon his car on an access road to Dulles Airport after telling his wife that he is going to buy a carton of eggs and a bottle of orange juice, never to be seen again

Bringin It's picture

Look up what happened to William Colby.  He went for an evening canoe paddle near the Chesapeak.

Freegolder's picture

The letter said:  'that the second global reserve currency is on the brink'.

Perhaps indicates the letter writer is less than switched on to the Euro's unique qualities.

MsCreant's picture

Are you saying they are a buch of boobs?

Dr. Richard Head's picture

Apparently strange boobs with Fukishima nipples.

NotApplicable's picture

Please allow me to introduce myself
I'm a man of wealth and taste
I've been around for a long, long year
Stole many a mans soul and faith
And I was round when Jesus Christ
Had his moment of doubt and pain
Made damn sure that Pilate
Washed his hands and sealed his fate
Pleased to meet you
Hope you guess my name
But what's puzzling you
Is the nature of my game

tenpanhandle's picture

navel oranges are old and boring and  weren't selling well.  These are the new GMO nipple oranges.  I'd be a little afraid when fresh squeezed.

williambanzai7's picture

I originally did it during the DSK fiasco. But it has all kinds of other themes running in the background, particularly now that Lagarde is at the helm.

Dr. Engali's picture

Be can poke an eye out with those things.

MsCreant's picture

Maybe poke an Eye-M-F out? William would like that a lot, I think.

Dr. Engali's picture

buh dump bump..  Good one.

williambanzai7's picture

Very good, I can do something with that.

ali-ali-al-qomfri's picture

Oh mister, mister....

Ms Legarde and that NJ tan mom certainly could use some Banzai make-over magic...aye?

they are both quite crispy.


Peter Pan's picture

WB7, I think you mean international mammary fund,

Dr. Engali's picture

I'd like to make a withdrawal please.

Peter Pan's picture

We are all suckers but unfortunately only for punsihment so far.

Josh Randall's picture

It took me 20 years to realize I was in the Mob....

Dr. Richard Head's picture

Shit must be getting real bad up in there.

Unprepared's picture

Mobs are not supposed to wear uniforms, that could deceive any one. He thought he was part of the Enslaving Army.

grunk's picture

By the way, can I use you guys as a reference?

Dr. Richard Head's picture

What's the over under on the bet that this does NOT appear anywhere in CNBC's broadcasting?

Josh Randall's picture

Anybody else find it ironic that an IMF big wig mentions Sweden and Israel in the same breath ? Where else have I heard Sweden and Israel entangled together in the past 72 hours ? hmmmm....

surf0766's picture

"The consequences include suffering (and risk of worse to come) for many including Greece, that the second global reserve currency is on the brink"


It it is know the dollar is collapsing or is going to collapse.

LawsofPhysics's picture

Going to?!?!?!?!?  Track the purchasing power of the dollar in just about anything since the Fed took over issuance.

Let The Wurlitzer Play's picture

He is acutally taking a jobs with the FEDs.  The free porn and prostitues are more appealing.

Dr. Engali's picture

Sounds to me somebody else wants to get the fuck out of Dodge before the shit hits the fan. Probably trying to "get on the right side of things" in hopes that he won't be hanging from a lamp post in the future.

surf0766's picture

Hey Doc,  I thought that also. How close to the brink are we?

Dr. Engali's picture

You never can tell about these things, but I always felt mid August early September things would start falling apart.

Dr. Richard Head's picture

Of 2008?  Then yes, I agree.

Dr. Engali's picture

Agreed..I'm refering to the next stage.

Nadaclue's picture

And who knows how many bankers have bailed since April. This guy says at least 450 in this April piece. Rats jumpin ship like no other time.

Interesting times ahead bras, adjust accordingly.

grekko's picture

Yes, but worked at the non-crisis countries desk, and probably had nothing to do all day long.  Must have been a pretty boring and sleepy job.  Maybe I should apply.

Disenchanted's picture



Somebody's been sitting on that info for a month...

MsCreant's picture

Give us time to get our affairs in order...

Shigure's picture

Had to give a month's notice?

Yen Cross's picture

Self Employment/ is very Gratifying!   

francis_sawyer's picture

maybe he was distraught over the death of Rodney King...

sessinpo's picture

A shocking endorsement of an esteemed governmental international body (sarc).

When looking for the problem, look to who is providing the solution and you often find the problem.

sessinpo's picture

The market is on cue for some major downside in the coming months. Like I said the other day, surprises to the downside. Also to much military buildup around Syria and Iran. Something is afoot. This is not a time to be long equities over the coming weeks and months.

Meesohaawnee's picture

that would be great if Ben said that about the fed.

slackrabbit's picture

Jim Grant beat them all to it...