Potential Solutions Given this history of banking crises throughout the world - some the result of poor banking practices, some tied to the rapid ebb and flow of cross-border capital, and some due to internal macroeconomic policies - what should one recommend?
I would like to focus on three sets of solutions designed to minimize the risk of future cross-border banking crises: (1) improvements in supervision and basic banking skills; (2) international transparency, including sound accounting standards; and (3) ways to avoid potential problems in capital flows. This analysis also points to a responsible policy for countries faced with unsound banking systems.