The International Monetary Fund said Tuesday that financial losses stemming from the U.S. mortgage crisis might approach $1 trillion, citing a “collective failure” to predict the breadth of the crisis.  In other words the US economy is still in big trouble. IMF Managing Director Dominique Strauss-Kahn noted that, “total losses, including the securities tied to commercial real estate and loans to consumers and companies, may reach $945 billion.”  That kind of sucks.

This is a rather alarming financial report about the alleged and impending US financial “crisis.”  It’s no secret that so goes the US economy so goes the worlds.  It’s within the best interest of all, well mostly all, nations that the US economy does well and continues a predictable steady growth.  Following that point the IMF said that, ”further downward pressure on the dollar, particularly if it comes from sub prime or similar shocks, could boost liquidity and lead to an intensification of inflationary pressures in some emerging markets.” 

Add this to the skyrocketing price of commodities and the outlook is gloomy.

The IMF concluded their report saying that, “there was a collective failure to appreciate the extent of leverage taken on by a wide range of institutions - banks, monoline insurers, government-sponsored entities, hedge funds - and the associated risks of a disorderly unwinding,” we’re in bigger trouble than we think.