US should regulate cross-border cash

By Henry CK Liu

In this season of debate on regulatory reform, an obvious area that has been crying out for reform seems to have been overlooked by government officials and market participants.

Much of past and current global financial crises lies in the unrestricted cross-border flow of speculative funds and the ability of market participants to deploy cross-border speculative financial and regulatory arbitrage for risky profit at the expense of central banks and local market fundamentals.