Lagarde: Recovery at a 'dangerous phase'

Sept. 9, 2011 at 5:50 PM

LONDON, Sept. 9 (UPI) -- Christine Lagarde, the new leader of the International Monetary Fund, urged economic powers to act quickly to combat the economic crisis in a London speech.

Lagarde said Friday it was "essential" that eurozone members ratify commitments made in July to increase bailout funding for Greece, The New York Times reported.

Lagarde also stuck to her guns on a suggestion banks in Europe build up their capital reserves, a suggestion she made in August in Jackson Hole, Wyo., that was greeted with skepticism.

In London, Lagarde said, "Countries must act now and act boldly to steer their economies through this dangerous phase of the recovery."

Just ahead of a Group of Seven meeting that will take place in Marseilles, France, Lagarde said, "Some banks need additional capital."

Some banks, she said, were on the brink of "a debilitating liquidity crisis."

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