Amidst continuing global economic crisis the future seems unclear and a number of analysts claim a change in the course is needed. While it seems that the US has been gradually recovering from the recession, the process remains slow.
Current situation and concerns
Policy makers are concerned with the urgent need for long-term oriented policies, as well as keeping to commitments on the part of local economies. Experts are calling for stricter financial regulations but even though regulations existed before the crisis, the issue of keeping to the rules remained topical.
Here is what BOJ governor Haruhiko Kuroda said during a recent BOJ-IMES Conference:
“The recent financial crisis has had a great impact on the global financial system as much as or even more than past crises. In a world of deepening financial globalization, financial crises were usually associated with emerging economies and triggered by a sharp decline in the exchange rate. But this crisis was different in two respects. First, the epicenter of the recent crisis was in the advanced economies and the crisis spread out from there to many emerging economies. Second, the crisis was triggered and then amplified by the dysfunction of financial systems. Reflecting on these observations, I believe that the global financial community must, in its efforts to rebuild the global financial system, come to terms with two issues: capital controls and financial regulation and supervision.”
Better control and long-term vision are some of the biggest aims. Even the International Monetary Fund has started to gradually accept the necessity of capital controls. Despite a number of pessimistic analyses it seems that the worst part of the crisis is over and now we are in a period of a slow US economic recovery. However, solving the debt crisis in the US is to become a fundamental issue in the future.
We should also keep in mind what Mr. Kuroda recently said: “Even if we could establish a global financial system that is robust at this time, such a system is unlikely to last forever, given that a financial crisis beyond our imaginations may occur in the future.”