BIGGEST EVER IMF SDR Allocation Means: nada [Ep. 94b]

The IMF will 'print' $650 billion -- BILLION! -- in SDR-money to help with global liquidity. BIG numbers! BIG Deal! But we've heard this before from the IMF, like in 2009, their last BIGGEST EVER allocation, which was as effective as QE1, QE2, QE3, QE4, QE5, QE6...

---------SPONSOR----------
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-----SEE EPISODE 94-------

-----HEAR EPISODE 94-----

----EP. 94b TOPICS--------
00:00 Show Intro: The IMF has released its largest EVER allocation of SDR 'money'.
00:17 Show Sponsor: Zimbabwean Office Depot Print Shop on Springfield and Main.
01:05 The IMF has released $650 billion of SDRs in 2021. What is the IMF? What is an SDR?
04:13 The SDR sounds a bit like national central banks creating bank reserves.
05:15 There are five currencies in the SDR basket. How / why did the Chinese yuan get included?
08:56 IMF SDR allocations took place in 1970-72, 1979-81, 2009 and 2021 for different reasons.
10:57 The 2009 IMF SDR liquidity allocation was gigantic; it didn't solve the liquidity crisis.
12:50 What does China in 2015-16 and the SDR tell us about today?
14:15 Show Summary: the IMF has made a big deal out of big numbers but we've seen this before.

----EP. 94b REFERENCES----

-----------WHO-------------
Jeff Snider, Head of Global Investment Research for Alhambra Investments and Emil Kalinowski.

---------WHERE-------------

-----------TAG------------
#JeffSnider #IMF #SDR

[SeaDrive]

Jeff: "Sophistry is using a lot of fancy-sounding words to say nothing."
Emil: "That's how I got where I am today, Jeff..."
Hahaha, impressive job of real-time self-deprecation by Emil. Nice one, Emil! :-)

[jonper]

Zimbabwe printers go brrrr ... love it were we can laugh rather than cry lol

[tommyaustin]

Emil, your show is so fun. It’s a great mix of super intelligent macro analysis with some humor to keep the listener awake! Also love the political cartoons.

[Worldly]

Emil, please have Jeff talk to Joshua Wang, a former Fed employee. He just had conversation with George.

[Kimber-bzfe]

Excellent thank you Gentlemen and I have more comprehensive understanding of what these are

[michaelayliffe]

Zimbabwe print shop, nice..
Good Saturday evening 🇦🇺

[adama]

Zimbabwe print shop also has an online presence, something to do about fire codes

[edhartwell]

Ha Love the Sponsor!!! Emil so super smooth!

[joelpeters]

Emil, I am beginning to appreciate your humor, mate. It took a while but I am coming around...

[DPSNewbie]

Lucky to learn from you guys. Thank you both so very much.

[AFKNOTT]

“The most striking difference between ancient and modern sophists is that the ancients were satisfied with a passing victory of the argument at the expense of truth, whereas the moderns want a more lasting victory at the expense of reality”
― Hannah Arendt, The Origins of Totalitarianism

[pleasantturtle]

Another great episode. When Jeff takes a break can we get a little rundown of some of your favorite book recommendations out of those books behind you?

[LanceHKW]

I need to have some money printed up...that print shop sounds like the ticket!

[DJMASTELLA]

I love attending Eurodollar U.!!!!
Thanks so much!
Question- if any country has a dollar shortage, why don’t their banks simply lend them some, like the Eurodollar? Surely European bankers aren’t more clever than others (ok, maybe more than the Fed...)?

[CSARichardo]

Well introduced that the IMF/SDR thing is very political. I also think that there is "some Eurodollar shortage relief" possible by this move which I am surprised you did not address. In this regard I think that the only SDR allocation that counts in helping the poorest countries will be the allocation made to the US Treasury which will be their cover for supporting some US/IMF loans (in $US) to these poorer nations to reduce their dollar squeeze. So it's not the US$275 billion (about SDR 193 billion) of the new allocation going to emerging markets and developing countries, including low-income countries that is important. It's the potential for poorer (US friendly) countries in getting IMF/US backed loans which could be supported by the the US allocation of around 113 billion in SDR that is important. Of course I could just be searching for a better answer than it's just BIG TALK !

[johnryskamp]

So are banks in a liquidity crisis or not? And if so, why?

[joshuavanderplaats]

Sophistry comes from the greek word for wisdom (sophia). It conveys the idea of speaking in a way that attempts to sound wise.

[stridedeck]

Sophistry: another way of stating the obvious tergiversation! IMF's and Central Banks' expertise!

[johnryskamp]

Considering that biparty repo is in charge and nothing else matters, what is the point of this program?

[jsmu]

I wanna raise a couple of questions here. 1) in percentage term, i assume that Majority of the SDR are converted into "US Dollar" ?? 2) if that is the case, is it fair to assume that US Federal reserve, IMF and WB (under the same consortium), are they using SDR as a key tool to solely and simply reinforce the demand for the USD in the weakest countries ? and to ensure no other major currencies could takeover its key leadership role.