Why Read: Because Christine Lagarde, International Monetary Fund Managing Director, is a smart woman with very broad knowledge. She is reported this morning as having made on Monday evening a very definitive statement on the Eurozone.
Featured Article: An article this morning reports that Ms. Lagarde has warned in a CNN interview aired Monday (June 10) evening that European leaders have less than three months to save the euro. Nouriel Roubini, of 'predictor of the sub-prime crisis fame', is also reported as saying time is running out on the Eurozone.
Commentary: This could prove to be a 'when Charles Schwab talks everybody listens' moment. If you are too young to remember those early 1990's 'Schwab advertisements', restaurants and other public places went silent when one person in the advertisement began to whisper to another - the overlay caption then said in a sonorous voice: "When Charles Schwab talks everybody listens". It was a very effective advertisement.
Christine Lagarde, France's Finance Minister until appointed as IMF Managing Director less than a year ago, is a formidable force and thinker - or so I think from observation, having never met her. She is in a position where she typically exercises a form of 'moral suasion' when she comments on world (and country specific) economic matters. Hence Ms. Lagarde tends to make sensible 'advisory statements' as contrasted with 'this will happen if you don't do that' statements. Accordingly, I find the statement attributed to her this morning to be an unusual one that seems to fall into the 'let's take the gloves off an tell it like it is' category.
Often with Ms. Lagarde's statements it is necessary to 'read between the lines'. That isn't necessary this time - so her reported view is worth reading and thinking about carefully if you are an investor, trader, or interested financial markets and world economics observer.