Financial Risk Watchdog

pg. 25: the creation of a global systemic financial risk watchdog [bold in the original] with the necessary authority to sound and compel a response to alarm bells, while respecting the regulatory purview of national authorities and building on the institutional framework that has been constructed in the wake of the financial crisis


Readers' Guide Comment on “with the necessary authority to … compel a response to alarm bells“ 

Within GRI’s recommendations on extending legal frameworks, this recommendation stands out. It is the only recommendation for international enforcement advanced in Everybody’s Business.

Readers' Guide Comment on “building on the institutional framework . . . constructed in the wake of the financial crisis”  
The London G20 Summit (2009) recommended closing the Financial Stability Forum (FSF) and creating the Financial Stability Board (FSB). With extraordinary speed, the FSF was ended and the FSB was established in London one week after the London G20 meeting.

A year later, WEF seems to believe that the new FSB will not have the capacity to avoid the next financial crisis. Consequently, it recommends a new global systematic risk watchdog body to replace the one year old Financial Stability Board.

Related Ideas: Four Tools; managing financial globalization; G20 as global leaders; fixes to the G20; fear of enforcement

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