Tim Geithner, the American Secretary of Treasury, was calling for more stringent controls of dubious derivative tradings conducted by dubious operators with dubious modus operandi. He cautioned other regulators not to compromise their regulatory systems to accommodate the rogues of the finance industry that the US is trying to regulate more closely with more stringent rules and regulations. His fear is that while the US was tightening the screws, other regulations are playing easy to take in the rogues and their business. The danger the rogues and their malpractices were thrown into the wind at their own risks.
Singapore and Hongkong have stood up to defend their regulatory systems as much more stringent than the Americans and told the Americans to look elsewhere. Our systems are in good hands. No problems.
I also think so. Hope there is no outcry like the minibond crisis in the future. The next one or two years could be telling if we are doing the right thing. As things are going, my prediction is that some operators will start to retrench staff and cut cost as the business is not generating the returns to cover their overheads, that is, if things do not improve. That will be the test of whether we are doing the right thing or the wrong stuff. The rest are just rhetorics. Let’s wait for the real stuff to unfold.