Just about every financial measure shot up on Wednesday's news that the International Monetary Fund was looking for an extra half a trillion dollars to lend to its members in need. The extra money would increase the fund's loan capacity to $880 billion from its current $380 billion, and it's looking for an extra $100 billion buffer on top of that. The goal is to be ready to lend to economically troubled countries in Europe. Some (more well-to-do) European countries have already pledged $200 billion, the Associated Press is reporting, so the fund is about a third of the way to its goal.
This makes markets and currencies very happy. A quick scan of the headlines following the news found it infused confidence pretty much across the board in Europe and the United States: "Wall Street Rises on IMF Hopes, Goldman Results," Reuters reported (the Dow, Nasdaq and S&P are up .52, .8, and .47 percent right now, respectively). "German Stocks Advance," Bloomberg Businessweek blared ("The DAX Index climbed 22.77, or 0.4 percent, to 6,355.7 at 4:04 p.m. in Frankfurt, having earlier risen as much as 1.1 percent and fallen as much as 0.8 percent," it reported). "Euro Rises as IMF Said to Seek $500 Billion Boost," another Businessweek headline heralded ("The euro appreciated 0.7 percent to $1.2820 at 10:16 a.m. New York time, after rising 0.5 percent yesterday"). "Stocks Higher on Hopes of IMF Cash Boost," USA Today touted ("Bank of America Corp. and JPMorgan Chase are the Dow's leading stocks. BofA rose 2.8%, JPMorgan was up 2.7%."). The $500 billion is a huge amount for the I.M.F. to try to raise, but from the initial reactions in the financial markets, just announcing that it's doing so seems like a good way to boost the markets.
This article is from the archive of our partner The Wire.