In effect, countries with diversified financing sources may be better placed to weather shocks to the economy. However, market-based finance is unlikely to erase all of the imperfections in our future financial system. In particular, market-based finance is not very effective in reducing information asymmetries, so it probably will not fill the funding gap for young, small- or medium-sized businesses.
No doubt, Mother Nature has a plan to fill those gaps in time, and one probable source is private lending and equity, a second channel where competitive forces are likely to emerge. There have been significant advances in technology that are sure to influence the future provisioning of private capital.