London, October 28:

Last week’s annual meeting of the World Bank and International Monetary Fund (IMF) may go down as one of the least significant in the history of the Bretton Woods institutions, which were planned in 1944 in order to ensure that the world would thenceforth avoid the ill-conceived economic policies and beggar-my-nei-ghbour protectionism that contributed to outbreak of the Second World War.

Nothing much happened at last week’s meetings, although there was an awful lot of talk. But, paradoxically, it is precisely because nothing much happened that the meetings may be remembered.

This year’s meetings were preceded by a minor Wall Street crash, if only to demonstrate that they marked the 20th anniversary of Black Monday (October 1987), which had been precipitated in

part by open disagreements on fringes of that year’s IMF meeting between two me-mbers of G7 about monetary and exchange rate policy.

This year’s meetings were preceded by the US sub-prime crisis and its ramifications.

However, the point made by one senior policy-maker last week was that the sub-prime crisis was merely the trigger for an inevitable reaction to the insanity of the financial markets’ ‘search for yield’, in a world where a glut of mainly Asian savings had reduced long-term interest rates to low and boring levels.