International Monetary Fund chief welcomes European bank rescue plan

The head of the International Monetary Fund welcomed a European bank rescue plan on Monday despite its high cost, and predicted that weekend efforts by world leaders would soothe anxious global markets. "I don't think there's a reason ... to fear," Dominique Strauss-Kahn said on Europe-1 radio. "The political determination is total." In Europe's most unified response so far to the financial crisis, nations that use the euro currency agreed Sunday to temporarily guarantee bank refinancing and pledged to prevent banks from failing, as part of a raft of emergency measures designed to ease the credit crunch. Banks' reluctance to lend to each other has helped fuel the crisis that has pulled down some of Wall Street's most storied names and is pushing the US and Europe to the brink of recession. "We must recapitalize the banks ... otherwise everyone will suffer," Strauss-Kahn said. "And that costs money."