Toto, we’re not in Kansas anymore: Exploring the Contours of the Financial System After the Tornado

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? Now, as the storm subsides, there is time to speculate about what the future financial sector might look like. Here, Laura Kodres blogs about a new Staff Position Note she co-authored with Aditya Narain that attempts to discern the contours of this new financial landscape.

It’s Hip to Be Square—Why Good Financial Sector Supervision Is Important

As the financial crisis taught us, supervision is incredibly important. Countries with the same set of rules had very different experiences during the crisis. Why? There are clearly many reasons but one of them is “better supervision.” After all, rules are only as good as their implementation. In some countries, the financial supervisor became the unsung hero of the crisis. One might say “It’s hip to be square!”

IMF Opens Up: Partnerships with Donors a Win-Win

Technical assistance in the IMF’s areas of core expertise is not only an important complement to the IMF’s policy advice in many countries but also helps them pursue their broader developmental and poverty reduction strategies by strengthening their capacity in macroeconomic management.

Going Beyond the Rules

Some countries with similar financial and regulatory systems fared differently during this crisis. What are the reasons for this? And what made some financial institutions with similar business models, and in the same country, better equipped to deal with the virulence of the crisis?

By | December 1st, 2009|Economic Crisis, Financial regulation|1 Comment
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