It addresses the perverse incentives that have produced a level of leverage both excessive and misperceived, and introduces new capital and liquidity requirements. On the foreign exchange front, the dollar, in spite of its present weakness, remains the currency of the world’s largest economy, with deep, open and liquid financial markets and a central bank with a firmly established reputation for independence.
Cash ow, or liquidity, is the main concern for many businesses. Half of large corporations hold less than 8% of annual turnover in cash. 20 Half of SMEs hold less cash and SMEs have less access to undrawn credit than their larger counterparts.