G-20 Pushing for Expanded Global Regulatory Cooperation

There's nothing like a crisis to show how interconnected the world has really become. If there's one thing the current economic downturn has shown us is that the financial system is truly global.With this fact in mind, the finance ministers from the G-20 nations met in London this weekend as a prelude to the big meeting coming up in April. According to Bloomberg, the finance whizzes agreed to work together to clean up the toxic assets that helped trigger the crisis. The nations vowed to show a united front in battling the current crisis and preventing protectionism.

Among the guidelines introduced as the meeting, according to Bloomberg: shareholders should be exposed by the "maximum possible" to losses or risks prior to a government intervening; there should be flexibility when judging which assets can be aided and it should be clear how they are valued; and credit rating companies, hedge funds, and credit derivatives markets will be subjected to greater oversight.

The officials also agreed to strengthen ties between their countries' respective banking regulatory agencies and to implement more curbs on the financial system to "ensure regulations dampen, not amplify, economic cycles."

It may not be the worldwide "super regulator" some have been suggesting is needed to prevent similar economic crises in the future, but it certainly sounds like a step forward at least in achieving more concrete global regulatory cooperation.

For more on the meeting, see G-20 Turns Sight on Toxic Assets in Coordinated Move.