The Institute of International Finance is calling governments, financial institutions and regulators alike to take drastic measures to protect the global economy and "contain the risk" currently found in financial markets. Globe and Mail reports:
On behalf of that group, [IIF's managing director, Charles] Dallara recently sent a letter to finance ministers and central bank governors who are meeting in Washington, D.C., this week, telling them that, although financial markets have been calmer recently, considerable risks remain and urgent action is required... Finance leaders should agree to "take firm measures aimed at restoring confidence in financial markets, supporting global growth, and maintaining orderly foreign exchange markets," he wrote.
Even though the Federal Reserve has made adjustments in the U.S., the credit crisis is still a crisis. Another Globe and Mail piece says losses could reach $945 billion. And Dallara told his readers that the weakening markets in various countries could "feed off each other" to create a downward spiral of the global economy as a whole.
With an eye toward helping to fend off said spiral, the IIF is expected to release an interim report on Wednesday in which it will
make recommendations aimed at correcting gaps in financial firms' design and implementation of risk management, and suggest stronger standards in risk management governance, technical risk management issues, and stress testing.
An IIF review of accounting rules is reportedly in order as well, the story says.