Howdy, gang! If you thought Harvey was mean…just take a look at his younger, bigger, meaner sister, Irma! On behalf of everyone at Tackle Trading, I want to simply extend our heartfelt condolences to any of our readers who were in harm’s way. Our thoughts and prayers are with you and I’m not just speaking in platitudes. I am tentatively planning on coordinating with a family member (who lives in Texas) to see if my family can make a trip down south and simply offer our help in the form of physical labor. It’s a very small gesture, I know…but like I said, we really do care and sincerely hope that you and yours are safe.

Last week, we took a look at the International Monetary Fund (IMF) as I tried to lay it out as simply as I could. Easier said than done (especially while trying to keep my blogs under a certain amount of words)! The IMF is an extremely large organization with a lot of moving parts and deep, deep roots that go back to the Bretton Woods Conference, which immediately followed the conclusion of World War II. Though the intentions of the IMF may be coated in rainbows and unicorns, there are some seemingly legitimate concerns regarding the organization and the people who are in the IMF’s employ. For example, the IMF has been criticized for the conditions it attaches to loans, which have been seen as way too focused on austerity and the rights of creditor nations, rather than on the welfare of the poor and downtrodden. Another real concern is oversight. It’s proven to be very difficult to maintain standards by which the IMF is to be held accountable for. There’s definitely more than enough wriggle room for corruption and we only have to look at history to see that power usually leads to corruption…in some form or another.

The World Bank is also no stranger to criticisms and conspiracies, yet it continues to not only exist, but actually grow in its influence and reach (and balance sheet). Like the IMF, the World Bank was created during the Bretton Woods Conference (New Hampshire) in early July, 1944, to assist with the post-war economic recovery. Unlike the IMF, however, it grants loans for specific development projects. Increasingly, the bank has focused on reducing poverty in the developing world, although its policies are often blamed for forcing debtor nations to adopt liberal policies that leave them open to exploitation by multinational corporations.

I think I mentioned something about borrowing money from an uncle as an anecdote last week. Well, it definitely still applies when trying to understand the World Bank. The only HUGE difference is that your uncle is now extremely persistent and demanding in regards to what you’re specifically doing (and willing to do) with the money he loaned you. Instead of being coy and overtly particular with his demands (IMF) about how you’re using his money, he’s now rather insistent with his up-front demands and also a bit more covert about his intentions, which are probably unknown to you!

The World Bank, which has mainly focused on loans to developing countries, has been criticized for failing to pay sufficient attention to the social and environmental consequences of the projects it funds. Yes, the World Bank is under constant scrutiny for being very particular about its projects (which often times opens the doors to corporations who are all-too-willing to step in and utilize the resources of the poverty stricken nation for profits), while not putting nearly as much emphasis on social issues or the environment. Hence, the HUGE and MASSIVE protests that ensue wherever the World Bank decides to meet for its semi-regular summit. Well, using the word “protest” may be a stretch. I think the word “riot” is much better suited for the anarchy that takes place at a World Bank meeting! It literally takes weeks for cleanup crews to address the damage done by the face-covered rioters!

I’m not as proficient as I would like with the activities, expenditures, or project management of the World Bank (or IMF, for that matter), but I’m pretty sure I understand the consternation of citizens around the world regarding these two behemoth organizations. I happen to live in a country that has not (yet…ha ha ha) had to use the monies and infrastructure offered by these groups so I can’t really see the “unintended consequences” with my own two eyes. The World Bank and the IMF definitely end up leaving huge footprints wherever they set up shop and sometimes those footprints change the very fabric of society for the struggling country involved. On the other hand, no one is forcing any nation to accept the sweetheart loans offered to them via these two organizations! However, it is very difficult to say “no” to your eager uncle when he’s waiving a fist-full of money in your hungry, hungry face.

Until next time, my friends.

Be good. Do good. Know good.

Kleiny
Columbus, Indiana
Follow me on Twitter: @KnowGoodThings