But the increasing complexity of these instruments also raises a host of policy questions regarding, to name just a few items, accounting treatment, disclosure policy, netting provisions, capital charges, and the enforceability of netting and collateral arrangements in bankruptcy proceedings. A final trend worth singling out is the steady increase in global financial integration.
Expectations for the unwinding of lax policies have started to turn the tables on these impacts, as reflected by a weakening trend for emerging market currencies, among other tendencies. 15 In the attempt to moderate these effects, many financial authorities have responded with measures frequently justified as macroprudential policies. In particular, initially, many central banks cut policy rates.