CentreForum has released a new publication on the thorny issue of how to make sure the US and Europe do not proceed down contradictory paths in designing future financial regulation.
It is by my colleage John Springford, with whom I collaborated in producing “Divided we fall: can the G20 save globalisation?”
John has an OpEd in Guardian America laying out some of the issues. This paragraph summarises many of the problems being confronted:
International co-operation is always difficult, except in times of severe crisis. Now we are over the worst, it is unsurprising that financial reform is being driven by national interests. But, of course, finance is global, and apparently small differences in securitisation, derivatives, capital and trading rules are big opportunities for arbitrage. Capital will shift into countries where the returns are greatest.
Anyone claiming to have solved these issues would be a fool. We don’t. But we still believe that greater commitment towards the G20 as a forum might prevent regulatory gaps helping to cause a return to financial instability in the future.