from intermediate regimes. in 1990, nearly 70 % of all countries were pursuing some variant of intermediate er regimes, a share that dropped to 41 % by the end of the 1990s, and further to 30 % in 2004 ( figure 2 ) 1. exits from intermediate regimes were more frequently towards floats rather than to hard pegs. the share of floaters increased from 15 % in 1990 to 45 % in 2004 while, on the other extreme, the share of hard pegs rose from 15 % to 26 % during the same time span. the latter increase in hard pegs reflects, to some extent, the establishment of the european monetary union in 1999. the share of countries with crawling pegs – a very popular regime among higher - inflation economies – dropped from 14 % in a new imf database of de facto er regimes adopted by imf member countries allows to classify countries into three broad er regimes : hard pegs ( formal dollarization, currency union, and currency boards ), intermediate regimes ( conventional fixed pegs, crawling pegs, crawling bands, and tightly managed floats ), and floating er regimes ( managed float with no predetermined er path and independently floating rates ). 1990 to 6 % in 2001. in contrast, countries with a crawling band or a tightly managed float rose from 10 % at the beginning of the 1990s to 31 % by the year 2001. crawling bands offer – at least in the short - term – more flexibility in coping with volatile capital flows and avoiding extreme er misalignments, than rigid er regimes. tightly managed floats, on the other hand, keep the anchoring role of the exchange rate without committing to any explicit target parity. the transition of er regimes has come with a shift of mp regimes based on an er or monetarygrowth anchor to an it framework, particularly in emerging economies. the number of countries under it rose from 8 in 1999 to 21 in 2004 ( tables 1 - 2 ), and many more are considering to adopt it in the near future. this transition in mp regime has been more pronounced in latin america. while in 1994 twelve countries in the region had in place an er anchor, and four others had a monetary growth anchor, by 2004 only three countries remained with an er anchor. the transition of policy frameworks during 1994 - 2004 led to a significant rise in the number of latin american countries with a floating regime ( from three to twelve countries ) and an inflation targeting framework ( from one to five countries ). 2. chile

, not only about economics but about every walk of life, it is that people cannot be fooled forever, so the only way to act is realistically. we are enduring a world recession, and nobody disagrees about the current hardships the world economy faces, so the discussion has shifted to when we will see the first signs of recovery. the scenario of global economic and financial catastrophe has dissipated, and confidence seems to be recovering. one piece of evidence that the “ free fall ” of the world economy may have stopped is the evolution of growth projections for the year ( figure 14 ). after the sharp deterioration post - september 2008, the downward revision to the growth expected for this year has moderated in magnitude significantly in most of the economic zones. in japan, which has suffered one of the most intense revisions in the past few months, the latest forecast revised upwards the expected growth for 2009. gdp growth for 2010, which had posted small but systematic falls since september, is showing stability in the latest forecasts. combined with this, perceptions regarding investors ’ appetite for risk seem to be picking up. sovereign premiums have declined, capital flows to emerging economies are returning, interest rates on treasury bonds are increasing in many economies and the various expectations indicators are signaling some degree of recovered confidence. extreme pessimism is withdrawing, but we cannot expect an accelerated recovery. the confidence crisis is one piece – an important one – of the explanation of the synchrony and strength of the shock that occurred at the end of last year. however, the distortions that motivated this confidence crisis will have persistent effects, even after the confidence is fully recovered. the loss of confidence explains the sharp and sudden downfall of the global economy, as well as its propagation to the other countries. however, the origin of the crisis is not this loss of confidence, but rather can be traced back to years of financial excesses that will take time to resolve. 6 the big and, in the light of what we know today, unreasonable private overborrowing in many developed countries will have to be corrected, leading to significant de - leveraging mostly of households. they will raise their saving rates which will hold back growth in consumption and demand. the countries that grew fast based on credit booms will have to adjust. we cannot expect the world economy to go back to pre - crisis growth rates. these are normal stages of the business cycle, but the magnitude of the imbalances that formed in those countries now experiencing financial crises indicate