Sunday, May 22

IMF uncontrollable left, while Europe is on fire

WASHINGTON-the shock arrest of the head of the International Monetary Fund can world's power broker in a frantic search for his replacement, see force.

Hours after the New York police the sexual assault of maids charged with hotel Dominique Strauss-Kahn, the IMF said it John Lipsky, the Fund No. 2, the position was appointed the acting Managing Director. At a hearing in New York City on Monday, a judge Strauss-Kahn said jailed at least until his next court date should remain. The judge at the May 20 as the next date for the case set.

Prosecutors had asked to keep the Manhattan judge, Strauss-Kahn without bail. His lawyers had suggested that prosecutors million dollar deposit and promised that IMF Managing Director in New York City would remain.

Story: Questions, answers of Dominique Strauss-Kahn

He is with attempted rape, sex abuse, a criminal sex act, unlawful detention and violent touch accused. In prison the number is punishable years the top five to 25.

"This battle Defender has just begun,", which Benjamin Brafman said scores of reporters gathered outside the courthouse. "Mr Strauss-Kahn is innocent of these charges."

IMF officials said that Lipsky often runs the financial institution, if the Managing Director (MD) is away and said that it remained "Fully functioning and functioning."

But the announcement not mask concerns among some high-ranking officials of IMF Board about a possible leadership vacuum, especially as Lipsky, that he was planning said just last week, in August after down when his term ends.

Which could world's uncontrollable let lenders, as it is embedded in the euro area debt fix effort and the massive task to help debacle is to control the global economy, the nature of the policy that the cause of the crash of 2007-09.

"Europe is in flames," News Agency a Board official Reuters. "It's a good idea, Lipsky be MD but how long this will go on for made have?"

Several officials said it would provide important quickly his trust for the Board in Lipsky the ability to run the IMF without Strauss-Kahn.

Lipsky, a former Vice President of JP Morgan Chase & co., was with the 24-Member IMF Board meet on Sunday to them about developments concerning the arrest of Strauss-Kahn short.

But the IMF said that the meeting had been delayed "pending further developments in New York."

Story: IMF Chief denied bail at the hotel sex assault case

On the IMF Executive Board, consisting of representatives of the IMF member countries, including major shareholders such as the United States, France, Germany, China, and Japan, has to appoint the authority and to dismiss, the Managing Director.

While the 62 year-old Frenchman's playful experience, charisma and appetite for politics to retake a central role in the global financial market funds contributed, since he took over 2007, the latest incident too much for the IMF could prove Member States, even if he is cleared of the charge.

In 2008, the Board disabled Strauss-Kahn abuse of power over a short affair, which had with a female IMF Economist he but it warned against further wrongdoing. On this occasion Strauss-Kahn, "Error in the judgment" publicly apologized for one.

Several senior IMF sources have Reuters said they had concerns linger after the incident about whether her boss had taken the lesson to heart.

The institution of the scandal was published 2008 the extent of the financial crisis and the response from the IMF move. Strauss-Kahn even skeptics in the Fund, received high praise, for his efforts, which around the world make the institution at the heart in response to the meltdown.

Effective power broker
The IMF Chief was also central in galvanizing Europe against its debt woes at a time when European Heads of State and Government of huge bailouts for countries such as Greece, Ireland and Portugal support was shared have.

Speculation had previously swirling, Strauss-Kahn run the funds for the French Presidency in the year 2012 can be. To do this, he would have to declare end of July a candidate and step down from his job in Washington.

But IMF officials say barely had begun, which leaders might also think about the next IMF.

With the abrupt exit of Strauss-Kahn now possible search in tenure expire in September 2012, the process which may begins search for a new leader and this time could more burdened than in the past.

Developing countries have made it clear that they are the status quo challenge, under which the IMF captaincy traditionally has gone to a European while an American heads of the World Bank.

Brazilian Finance Minister Guido Mantega a shot fired in April, when the IMF said the Steering Panel: "It is high time that we make a political breakthrough in the outdated practice of start-up aid."

"The heads of the Bretton Woods institutions should only from an open and merit-based process without elected on grounds of nationality."

German Chancellor Angela Merkel has signaled on Monday that they the bailouts of ailing euro zone countries Greece, Ireland and Portugal strongly share another European at the head of the IMF, preferred.

Former Turkish Finance Minister Kemal Dervis name has brought in the last few months as a potential candidate in circulation have been.

Dervis was a former head of the United Nations Development Programme and is now a program economy at the Brookings Institution Washington-based think tank.

While some in the United Kingdom on a candidacy of former Prime Minister Gordon Brown, the Finance Minister for a decade until 2007 was speculated, his successor, David Cameron, the IMF urged outside Europe for your next guide.

Current French Finance Minister Christine Lagarde has been also some Europeans as a possible successor. Your the first female head which would make setting up.

Under other names that have been mentioned: South Africa's former Finance Minister Trevor Manuel, 55; Bank of Mexico of Governor Agustin Carstens, 52; and India's Montek Singh Ahluwlia, 67, influential Economic Adviser to Prime Minister Manmohan Singh.

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