Here’s the IMF’s timely Global Financial Stability Report -Financial Stress and Deleveraging Macro-Financial Implications and Policy.
And their media release warning about a failure to act decisively.
This attitude may well be destructive given that the whole nature of the financial system must change fundamentally. Knee jerk reactions tend to be unproductive. This can be seen in real time, when a bail-out or rescue package is unveiled only to see the stock market drop again as fear returns to the market.
The message that something is being done needs to be communicated. But that something needs to be fundamentally focussed on raising transparency and trust.
While the utility of money as a means of communicating and exchanging value is irreplaceable, the integrity of people in the system must be improved, from the big swingers who flog financial sophistication to the consumer in the street who decides what they buy. Self-discipline and modesty would be a good start.
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