Reducing such imbalances implies the continued implementation of policies that redistribute the pattern of global demand, including exchange rate issues, such as the choice of exchange rate regimes and reserve currencies. Hence, there is no time for complacency and policy responses to the crisis should not lose momentum! The IMF is working hard on several fronts to help its members combat the crisis.
In this situation, government regulation has a function but it should be based on clear objectives, narrowly tailored to meet those objectives, and, given the iron law of unintended consequences, it should be clearly superior to private regulation.