IMF – Why the spike in food/oil price is different from 2008

Wondering if history is repeating? IMF thinks that there are significant difference between the 2008 food/oil price spike and the one we are experiencing now in 2012. Main argument is that volatility is not the same as then and there is no uniform development across crops.

The analysis is sound in my mind. While I do not believe that the “IMF cure” is what we need with its focus on inflation as the only remedy. IMF acts like the surgeon who said “The operation was a success but the patient died”

However, one good point is that governments should reduce tax on food as a way to reduce the impact of a volatile food market.

Judge for your self:

http://www.imf.org/external/podcast/2012/Foodprices.mp3

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s