Global Markets Fall on Fears of US Recession

Global economic crisis 'serious': IMF Chief

Investors skeptical of U.S. stimulus package, says IMF's Strauss-Kahn; an American recession would spread globally, he warns.

PARIS (AP) -- The head of the International Monetary Fund called the global economic situation "serious" and said markets worldwide had responded skeptically to a U.S. stimulus plan.

Dominique Strauss-Kahn stressed that a U.S. recession would affect economies across the globe.

"The situation is ... serious," said Strauss-Kahn following a meeting in Paris with French President Nicolas Sarkozy. "All the countries in the world are suffering from a slowdown in growth in the United States."

He said investors were skeptical that an economic stimulus plan presented last Friday by U.S. President George W. Bush would shore up the economy, which has been battered by problems in its housing and credit markets. The plan, which requires approval by Congress, calls for about $145 billion worth of tax relief to encourage consumer spending.

"It appears that the markets did not appreciate the packet proposed by President Bush," he said, adding that the negative reactions were "perhaps to be expected."

http://money.cnn.com/2008/01/21/news/international/europe_econcrisis.ap/index.htm?section=money_latest