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Submitted by Cliff Tan on
James: Just saw this: 1) Phil Turner @ BIS had a good paper reviewing the state of Asian banking last year; 2) I think you're timely in bringing this up, perhaps especially where we may seeing an old horror movie repeat (your Vietnam example); and, 3) With respect to (2), am disappointed some Asian central banks have cut back on their production of financial stability reports, maybe just when we need them most. An ounce of prevention = a pound of cure, etc. With respect to Chris's comments, yes the ability to leverage (and earn money) through the existing mechanisms of investment banking and markets appears constrained for some time, and Soros and I Banks have been making the rounds with this thesis. But we don't know what future financial innovation may hold, and I've never failed to be surprised at the ability of Wall Street to innovate when there's a profit motive involved. One key is whether we have regulators who know when and have the guts to take away the punchbowl - two separate, equally important and unanswered questions; separate, equally important and equally unanswered, in developed and developing markets alike. Regards, Cliff