Why should our financial firms now believe that authorities will not stand behind them if conditions were to turn again to the worse? Moreover, many of our banks have become larger, not smaller as a result of crisis-related mergers. Moral hazard risks pose a large prospective burden for taxpayers and are a serious threat to the maintenance of a market-based system.
So what is to be done? •  At the Pittsburgh Summit, the G20 Leaders called on the FSB to propose by endOctober 2010 possible measures to reduce these problems.