| Even as nations take unprecedented measures to respond to the global financial-now-economic crisis, exacerbated structural tensions in the global financial system are yet to be resolved. But it cannot be done by any one institution or even one government. Rebuilding trust and moving from crisis, to health, to wealth will require committed, concerted effort from industry, government and individuals. Now is the time for us to work together, address the fundamentals and innovate. |
The metamorphosis of a country-centric subprime crisis to a worldwide economic slowdown has deeper roots than anyone could have ever imagined. Overnight bank failures, plunging stock markets, trillions of dollars in takeovers and government intervention, not to mention the death of iconic Wall Street brands, compressed decades worth of change into mere months – even weeks. Since the onslaught of the financial crisis – which began in mid-2007 and spiked during “Black September” in 2008 -attitudes, fears, opinions and the key structural tensions challenging the financial services industry, as well as proposed resolutions to the crisis, have shifted dramatically.
As the world struggles through uncharted waters searching for resolution, many of the emergent industry themes appear to be shared by experts in both the private and public sectors. At the same time, some deeprooted dichotomies exist and at multiple levels of the economy – not just at the organization levels, but also at the consumer level – and across sectors and geographies.
The primary question facing the industry has become: How can we move from crisis, to health, to wealth? We must begin by discussing three key factors:
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We are in the new “era of interdependence” in which the interconnectedness of the global financial system is at odds with its current design.
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Dichotomies in the marketplace are exacerbating a number of structural tensions that have thrown the global financial system into disequilibrium.
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The new era requires new maxims for progress – a shared approach to address the system’s imbalances and manage the overarching yin yang of financial stability and healthy innovation.
We now stand at a unique inflexion point. And all market participants can take immediate steps in adapting to the new environment. Every government, company, employee, consumer and citizen has a vested interest in resolving the current situation and in positioning for a brighter future. The entire “financial system business model” has the capability to become “smarter” – systemically collaborative, intelligent and dynamic – setting the stage for the creation of sustainable value.
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