This goal appears to be attainable: since crises are rooted in the financial and economic systems created by the people behind them, it is up to the people who can and must change the system to prevent future crises themselves. The current economic and financial system has become obsolete; it no longer meets the requirements of our era’s globalisation, a fact which the current crisis has effectively demonstrated. Therefore, the main lesson of this crisis is the imperative need to overhaul the global economic and financial structure.
In fact, the process has already begun.
I am referring to the regular meetings of the 20 leading countries’ heads of state and governments where new avenues of global development are discussed and practical measures for overcoming the crisis are approved. Their efforts have produced the first results.
The most important thing is that the G20 decisions are being implemented.
A relevant example is the solution to the problem of tax havens, which was come to diplomatically, without any arm-twisting or sanctions. Another example is the G20’s intention to create a new global currency that would be resistant to fluctuations on global exchanges and markets.
The G20 leaders have only outlined the problem so far, but their intention to solve it has been welcomed worldwide.
All countries, including those that do not attend the informal meetings of the G20 group, have admitted to needing more effective banking and financial controls and are working to restore order in these areas.
The crisis has shown that the situation is dramatic. It exposed Bernard Madoff, the former chairman of the NASDAQ stock exchange, who has admitted to turning his wealth management business into a massive Ponzi scheme that defrauded thousands of investors of billions of dollars. Many other people used investment fraud schemes, which the crisis has since exposed.
So, a new transparency system is being developed for lending and banking establishments and hedge funds to ensure strict control of national and international financial operations.
This is a direct result of the practical conclusions drawn from the crisis.
A major feature of the current crisis is that the leaders of the United States, China, Canada and India have managed to overcome their differences and found common ground. As a result, the global leaders have hammered out a coordinated approach to a variety of complicated problems and joined forces in combating the crisis.
It must be said that this is a landmark event, as it is the world’s first show of solidarity in the face of a common enemy.
We must now ensure that solidarity of this kind becomes the norm, and remains a basic element of international relations in the future. This is another lesson we must learn from the crisis.
In other words, the crisis has had a positive effect on the powers-that-be, who have admitted to the need for creating a new system to regulate global finance.
Now that they have seen the light and plan to address the problem jointly, crises of this kind must never happen again. But will we live to see that happy day? Only time will tell.
