SINGAPORE (Sept 7): The outcome of the Global Financial Crisis (GFC) has altered the business and economic landscape — for better or worse.
First, tighter regulations in the financial services industry were introduced in the US, including the Dodd-Frank Wall Street Reform and Consumer Protection Act enacted in 2010. Globally, including in Singapore, Basel III required banks to have higher capital and liquidity requirements.
The GFC’s warning signs had been missed by the financial markets community, from economists to bankers and analysts.
Nevertheless, industry observers contend that lessons learnt from the GFC were manifold: from spotting overleveraging and asset bubbles, to unrestricted capital flows and vulnerabilities in large financial institutions, as well as issues surrounding liquidity management and counterparty risks.
Ten years on from the GFC and signs of an impending recession can be observed, notably a flattening yield curve, or the spread between the short-term and long-term yields on US Treasury notes.
What do these mean? Are they warning signs, or just “the new normal”?
Find out what economists and market watchers think in our cover story, After Lehman, this week in issue #847 of The Edge Singapore, which is available at newsstands today.