According to this mechanistic view of the impact of the new measures, policy-makers face a trade-off between the degree of safety of the banking system and economic activity. I believe that this reasoning suffers from what I would call a “partial equilibrium” and “static” perspective.
Of the 21 cities expected to reach 10 million plus by 2015, 17 of them will be in developing countries. Of these 17 cities, 11 of them will be in developing countries in Asia and those will be Dhaka, Mumbai, Delhi, Jakarta, Kolkata, Karachi, Shanghai, Metro Manila, Beijing, Istanbul and Tianjin (Table 5).