U.S. needs balanced solution for 'fiscal cliff': IMF (2)

"It is more exposed to its own difficulties and to its own issues, than to what happens elsewhere in the world, because it is such a large player."

Lagarde predicted the immediate aftermath of falling off the " fiscal cliff" would be "lack of confidence" and the markets would react very quickly.

She told CNN that a comprehensive plan for the fiscal issues is better than a quick fix and she remains hopeful that the lawmakers would negotiate a way to tackle them.

"I believe that there is a sense of being practical, addressing the issues, rather than dancing around and avoiding issues that I have seen in this country," she said.

As "fiscal cliff" nears, Obama administration and congressional leaders are trying to come up with a plan to avoid it. Failure to do so could tip the U.S. economy back into recession.

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