Rationales and Designs to Implement an Institutional Big Bang in the Governance of Global Finance

The colossal challenges facing international finance pertain to both its governance system and its dual utility and speculative functions, which have become ever more intertwined with the advent of financial innovation. In the aftermath of the Global Financial Crisis (GFC), a number of significant reforms are under way to address the second issue, including additional capital and liquidity requirements for banks, measures to battle interconnectedness in the financial sector, new resolution regimes that would allow banks to fail more easily, and stricter frameworks for bank supervision and monitoring of systemic risk. Yet limited progress has been made with respect to governance structures, which, thus, will be the main focus of present analysis. In this Article, I provide an outline of a proposal for a new model of governance for global financial markets to address most of the above challenges in a way that would be more effective than the preexisting regime or the architecture emerging as a result of the GFC.