IMF's uneven dealings with Greece is saga of embarrassment

Greek bailout: the IMF's reputation has been dented with its overly optimistic projections and wishy-washy stance on debt write-downs

One big loser from Greece's (likely) default is the reputation of the International Monetary Fund. The IMF, we used to believe, only stepped in when a country's path to debt sustainability was clear and economic revival could be plotted with reasonable confidence. The organisation's standing as a global lender of last resort relied on the even-handed application of that principle.

In Greece, it's hard to say the debt was ever sustainable in the world after the global financial crisis of 2007-09. In 2010, when the IMF contributed a30bn to the first bailout programme, Greece hadn't yet experienced its deep recession. But the risk of deep spending cuts making the position worse was obvious: the unpromising backdrop was a weak eurozone in which banks remained under-capitalised.