Moreover, regardless of perceived risks, financial institutions pulled money from risky assets in advanced and emerging markets alike in an effort to strengthen their balance sheets. Following the reversal in capital flows engendered by the crisis, strains in banking appeared across Asia, leading to severe credit tightening in some countries.
There is another reason to view government aid cautiously – its impact on competition. In recent years, the rising market power of bigtech corporations has already raised concerns and induced actions by authorities and lawmakers to protect competition. [8] Now, insolvencies and takeovers during the crisis may amplify market concentration.