Posted on January 23, 2014 by iMFdirect
By José Viñals
Brisbane and Basel may be 10,000 miles apart, but when it comes to financial regulation the two cities will be standing cheek by jowl.
At the next summit of the Group of Twenty advanced and emerging economies, to be held in Brisbane in November, political leaders will take the pulse of the global financial regulatory reform agenda, launched five years ago. The explicit goal of the Australian G-20 presidency is to finally complete these essential reforms. As Prime Minister Tony Abbott said today in Davos, “Financial regulation is always a work-in-progress, but these reforms now need to be finalized in ways that promote confidence without eliminating risk.”
I strongly support this extra push to create a safer financial system that can better support the needs of the real economy, and better protect taxpayers. For far too long, critics have been able to portray the G-20 reform agenda as a regulatory supertanker stuck in the shallow waters of technical complexity, financial industry pushback, and diverging national views. This image is increasingly off the mark.
Filed under: Economic Crisis, Economic outlook, Employment, Europe, Financial Crisis, Fiscal policy, G-20, growth, IMF, International Monetary Fund, Politics | Tagged: Basel III, Ben Bernanke, Davos, economic reform, European Union, Financial Stability Board, G-20, global financial system, Japan, José Viñals, U.S. Fed, United Kingdom, United States, United States Federal Reserve | 3 Comments »
Posted on September 21, 2011 by iMFdirect
By José Viñals
(Versions in عربي, Français, 日本語, and Русский)
We are back in the danger zone. Since the IMF’s previous Global Financial Stability Report, financial stability risks have increased substantially—reversing some of the progress that had been made over the previous three years.
Several shocks have recently buffeted the global financial system: unequivocal signs of a broader global economic slowdown; fresh market turbulence in the euro area; and the credit downgrade of the United States.
This has thrown us into a crisis of confidence driven by three main factors: weak growth, weak balance sheets, and weak politics. Continue reading
Filed under: Economic research, Europe, Financial Crisis, Financial regulation, Financial sector supervision, IMF, International Monetary Fund | Tagged: balance sheet repair, bank balance sheets, capital buffers, confidence, credit risk, deleveraging, financial danger zone, financial stability risk, Global Financial Stability Report, global financial system, household balance sheets, IMF, iMFdirect, International Monetary Fund, sovereign and financial balance sheets, sovereign risks, weak balance sheets | 9 Comments »
Posted on May 27, 2011 by iMFdirect
By Aditya Narain and İnci Ötker-Robe
Folklore is riddled with tales of a lone actor undoing a titan: David and Goliath; Heracles and Atlas; Jack and the Beanstalk, to name a few.
Financial institutions seen as too important to fail have become even larger and more complex since the global crisis. We need look no further than the example of investment bank Lehman Brothers to understand how one financial institution’s failure can threaten the global financial system and create devastating effects to economies around the world. Continue reading
Filed under: Financial Crisis, Financial regulation, Financial sector supervision, International Monetary Fund | Tagged: bailout, Basel III, capital requirements, crisis prevention, financial disclosure, financial institutions, financial stability, financial supervision, global financial system, investment bank, market discipline, moral hazard, resolution regime, systemic collapse, systemic risk, too big to fail, too important to fail | 3 Comments »
Posted on April 14, 2011 by iMFdirect
With global challenges that require global solutions—the theme of the meetings—IMF Managing Director Dominique Strauss-Kahn reminds us that this is “not the time for complacency.”
Government ministers and officials, members of civil society organizations, journalists, and others are flocking to Washington DC this week to discuss and decide on key issues facing the global economy. Continue reading
Filed under: Annual Meetings, Civil Society, Economic outlook, Employment, IMF, Inequality, International Monetary Fund, Multilateral Cooperation | Tagged: capital controls, cooperation, Fiscal Monitor, Global Challenges Global Solutions, global economy, Global Financial Stability Report, global financial system, global imbalances, Globalization, IMF-World Bank Spring Meetings, inequality, international monetary system, policy coordination, unemployment, World Economic Outlook | 3 Comments »
Posted on April 8, 2011 by iMFdirect
By José Viñals
When the global financial system was thrown into crisis, many policymakers were shocked to discover a gaping hole in their policy toolkit.
They have since made significant progress in developing macroprudential policy measures aimed at containing system-wide risks in the financial sector. Yet progress has been uneven. Greater efforts are needed to transform this policy patchwork into an effective crisis-prevention toolkit.
Given the enormous economic and human cost of the recent financial debacle, I strongly believe that we cannot afford to miss this opportunity for substantial reform. Continue reading
Filed under: Financial Crisis, Financial regulation, Financial sector supervision, G-20, International Monetary Fund | Tagged: capital requirements, credit growth, crisis prevention, financial stability, global financial crisis, global financial system, loan-to-value ratio, macroprudential policies, macroprudential regulation, regulatory arbitrage, systemic risk | 9 Comments »
Posted on January 3, 2011 by iMFdirect
While 2011 is still shiny as a new penny we thought you might like a quick review of 2010’s hot topics in the global economy. The iMF Direct Blog has picked our list of must read posts covering the highs and lows of global finance and government budgets and spending.
- The Ten Commandments for advanced economies to keep the economic recovery on track
- The financial world remains the Achilles Heel of the global economic recovery
- We explain the right mix of ingredients for countries to provide sufficient support to economic activity, and reassure markets in How to Bake a Fiscal Pie
- Fixing the financial sector – Just Do It
- Stable prices and financial stability go hand in hand, or do they? A Marriage Made in Heaven or Hell
- What Must Be Done – the top five reforms to the financial system
- When it comes to supervising the financial rules of the global economy, It’s Hip to Be Square
- Watch This Fiscal Space to figure out how much room to maneuver governments have when it comes to controlling debt and deficits
- Financial markets and regulators need to break their Credit Rating Addiction
- The global financial tornado means We’re Not in Kansas Anymore, but what will the future financial system look like?
Filed under: Advanced Economies, Economic Crisis, Economic research, Emerging Markets, Employment, Europe, Financial Crisis, Financial regulation, Financial sector supervision, Fiscal policy, Fiscal Stimulus, G-20, Globalization, growth, International Monetary Fund, Public debt, recession | Tagged: financial markets, Financial regulation, financial sector, fiscal policy, global financial system, must read, top blogs, top posts for 2010 | 3 Comments »
Posted on August 16, 2010 by iMFdirect
By Laura Kodres
Just as a tornado in Kansas transplanted Dorothy and, her dog, Toto, from familiar comforts to the unknown land of Oz, the global crisis has led many to wonder what has become of the global financial system and, more importantly, what will it look like next. Is the wicked witch of the West—excessive risk taking and leverage—really dead?
But now, as the storm subsides, there is time to speculate about what the future financial sector might look like. My IMF colleague, Aditya Narain, and I have done just that in a new Staff Position Note that attempts to discern the contours of this new financial landscape. What is clear is that the new landscape will be influenced by both the private and public sectors—their reactions to the crisis and to each other.
Filed under: Advanced Economies, Economic Crisis, Emerging Markets, Financial Crisis, Financial regulation, Financial sector supervision, IMF, International Monetary Fund, Multilateral Cooperation | Tagged: banks, contagion, deleveraging, financial reform, Financial regulation, financial sector reform, financial sector supervision, financial supervision, financial system risk, global financial system, leverage, macrofinancial linkages, macroprudential regulation, nonbanks, regulatory perimeter, risk taking, systemic collapse, systemic risk | 5 Comments »