In a series of summits, leading countries of the world will meet to draw up an international arrangement for financial stability. Such a rule system should prevent a financial crisis as we have seen it in 2007 and 2008. It should include appropriate principles of monetary policy, rules for financial soundness and agreements on the role of prudent regulation. The paper discusses the lessons from the subprime crisis, failures of regulation, crisis management in the US and in the EU and considers the problems that have to be solved by an international rule system.
Financial instability lessons from the subprime crisis failures of regulation crisis management elements of an international rule system role of the IMF