Looking Ahead: an Argument for Setting up the FDRC

Leonidas E. de la Rosa, School of Economics and Management, University of Aarhus

Abstract

The current financial crisis has been deepened by the fact that investors are very uncertain about the risks entailed by many financial instruments. Creating a public institution to identify and quantify these risks, subject to transparency and accountability, will prove very valuable in the medium- and long-run. Private credit-rating agencies were not, and in my opinion could not be expected to be, up to the job.