Daily volatility in the global economy is now roughly the same as used to be seen in a year!

Witness the Pound going from USD 1.63 to 1.52 and back to 1.59 in 24 hours on 24th October this year.

The above (interesting) factoid is provided on his excellent Blog by John Wisbey, Chairman and CEO of Lombard Risk Management plc, the second largest global provider of regulatory compliance software and award-winning provider of risk management solutions to over 300 financial businesses and large corporations. The company's clients include over 20 of the world's top 50 banks, as well as many industry leading investment firms, asset managers, hedge funds, fund administrators, and global corporations.

There is one principal point on which I disagree with his analysis of why we are in the present crisis, and that is where he asserts that the authorities "either failed to compile appropriate data to aggregate what was happening or, if they did, failed to interpret it properly to see the increasing systemic risk that this property bubble and efficient securitization presented".

I have often quoted the 2004 findings of the Joint Committee, set up by the three global associations that are responsible for all aspects of the world financial system. Assigned the job of calculating how much risk there was in the global system and who held it, the Joint Committee was quite open about its interpretations and conclusions. I was not the only one who has been drawing attention to those findings, and I am hardly the only one who has been going on and on for years about systemic risk.

Anyway, though I do not agree with Jim on everything, he writes perceptively. So I commend his Blog, which will give you the view of someone whose entire business is focused on providing tools for the management of financial risk worldwide. Sphere: Related Content