Around the world, legislatures, regulators, supervisors, accounting boards, central banks, and others with responsibility for oversight of the financial system are already hard at work trying to distill the lessons to be drawn from this experience and their implications for policy. Many in the private sector, including banks, credit-rating agencies, and the investment community, are likewise actively reviewing and responding to these developments.
Some of the areas that will draw scrutiny are the appropriate use of credit ratings by investors, banks, and supervisors; the need for enterprise-wide, better-integrated risk-management techniques in large financial institutions; the appropriateness of accounting rules governing asset valuation and the use of offbalance-sheet vehicles; and weaknesses in the originate-to-distribute model and in the design of structured credit products, among many others.