Publication: Yahoo! Finance
Author: John Rogers
12/20/2012 —I watched the movie “Contagion” on a recent flight to Asia. It tends to dampen the enthusiasm for culinary adventures.
In reality, it’s a lot more likely that our next global contagion will come from financial markets, and not from some butcher shop in Asia. Everything we know about financial systems points to continued globalization and interdependence. With that comes the near certainty that a systemic crisis in one major market will cause severe consequences in other markets. Financial crises truly are ill winds that blow no good. As a counterbalance, the need for coordination among regulators, legislators, and others responsible for financial stability has never been higher.
The Process Has Already Begun
As a member of the U.S. Systemic Risk Council, I urge a renewed commitment to international coordination on key issues of systemic financial risk. As financial markets struggle to rebuild, it has become all too clear that no one can safely go it alone. Domestic politics and agendas often distract us from the importance of working across borders to build better markets. It is all too easy to “take a pass” on the difficult decisions and compromises required to build international agreements. Waiting until markets unravel or banks fail to take action is a costly mortgage on
future investors and taxpayers.
Read the full article, Global Financial Markets Need to Coordinate Now or Pay the Price Later, on the Yahoo! Finance website.