IMF in Turmoil; Who Will Replace Dominique Strauss-Kahn?
The International Monetary Fund, as predicted in a recent post, will need to find a new managing director, following the arrest and indictment of Dominique Strauss-Kahn over allegations of sexual assault involving a maid at a Manhattan hotel. With Europe engulfed in a full-blown sovereign debt crisis, and the IMF viewed increasingly as the lender of last resort for the insolvent PIGGS nations on the periphery of the European monetary union, a vacancy at the top of the International Monetary Fund adds further to already elevated levels of market uncertainty.
Among the names being floated for new head of the IMF is the finance minister of France, Christine Lagarde. Her name has been surfaced by a strong faction within the IMF which believes its head must remain a European, just as the leader of the World Bank is traditionally an American. In any event, whoever is the new leader of the IMF, he or she will head a pivotal backstop to the unraveling of the global financial system and economy that has been severely weakened and tarnished by a scandal that is an allegory for all the ills of the current global economic system.