MercoPress. South Atlantic News Agency

Demand your banks and advisors

Nobel Prize winner economist Joseph Stiglitz said investors who purchased now defaulted Argentine sovereign bonds should demand their banks and financial advisors.

Mr. Stiglitz added that "Argentina never had the intention of defaulting but IMF policies pushed the country into that situation".

The Nobel Prize winner, former advisor to the Clinton administration and chief economist of the World Bank recently met with Argentine president Nestor Kirchner in New York when the UN General Assembly.

"We touched many topics but I insisted on how dangerous it was to borrow too much money. Banks lend money when you don't need it and claim it back when you most need it", remarked Mr. Stiglitz.

"Confidence in the Argentine economy will be restored with growth, not recession. If Argentina consolidates a steady growth path, investments will return".

In his latest book "The happy nineties", Mr. Stiglitz recalls successes and failures of the Clinton administration, (1992-2000), particularly efforts to achieve a balance between market and government.

The Nobel Prize winner admits that in some areas this was achieved but then "we succumbed to the mantra of deregulation and "all for free enterprise" crusade".

This "market fundamentalism" was then fiercely applied by the US Treasury, IMF and the World Bank in emerging markets of Asia and Latinamerica.

"Many people are led to believe that the economic success of United States is market fundamentalism. This is not true. The US government has played a leading role in all aspects of economic development", indicated Mr. Stiglitz adding that the federal government finances mortgage credits and the social security system "with lesser costs than similar ones in the private sector".

"But while this was happening in the US, in Argentina as in many other countries we preached that market fundamentalism was the cause of success. And this simply is not so".