Today U.S. Treasury Secretary Hank Paulson presented his proposals for a reform of the system of supervision and regulation of financial markets following the most severe – still ongoing – financial crisis in the U.S. since the Great Depression.  And soon the Draghi Commission within the Financial Stability Forum will report its conclusions and proposals for reform of the financial system to the G7 Finance Ministers.

To understand whether the U.S. Treasury proposals make sense one should first analyze what are the problems that an increasingly complex and globalized financial system face and what are the shortcomings of the current system of financial regulation and supervision, in the U.S. and around the world. Only a detailed consideration of such problems and shortcomings can lead to the recognition of the appropriate reforms of the system.So, let us consider in more detail such problems and shortcomings of the financial system and of its regime of regulation and supervision.

They can be summarized in ten points or issues…