Saturday, March 13, 2010
Why the buck doesn't stop
Of the multiple causes, the main suspects that just about every economist has pointed out are as follows, though not necessarily in the same order:
1. The crisis did not originate in the real sector of the economy. It was triggered by the excesses of the financial system. What stands out glaringly is the regulatory failure in relation to the financial markets. Some parts were either loosely regulated or not regulated at all. Along with this was the failure of the regulatory authorities to understand fully the implications of the various derivative products. The regulators did not exercise the required degree of oversight and control. Therefore, fixing the financial system is the first priority.
Full report here Business Standard