Global Risks 2009

Here are some of the risks identified and issues addressed by the speakers in this very interesting session:

- the speed at which the governments have developed the recovery plans.
- protectionism
- creditworthiness of the borrower of last resort (e.g. Iceland)
- resolution of intergenerational multilaral issues: carbon, large population going up for retirement, increase in unemployment and skills imbalance resulting in social unrest.
- speed with which banks return to becoming banks.
- good companies are taking too long to act.
- Afghanistan and Pakistan will become a major source of political crisis that will make dealing with other crises much more difficult.
- There is a set of interacting crises that creates a large systemic crisis. Financial crisis will not end soon.
- A series of peaks and troughs in the fuel and food prices over the next 2 to 5 years.
- Increase in cybercrime and disruption of the Internet which will have a large impact on financial and communication networks.
- Environmental problems from ecosystem destruction.
- With these crises converging, it is difficult to deal with them effectively resulting in a system crisis.
- There has also been a failure of risk management.
- Will the fiscal policy plans be enough?
- Social unrest, loss of rule of law in certain countries.
- Liquidity risk
- Business will need to become accustomed to the involvement of governments at unprecedented levels.
- We need risk intelligent enterprises. Risk management needs to become a key business process. We should not turn risk management into risk avoidance
- We need to fully appreciate the psychology of economics. Hope is very important and the Obama factor could help solve the current problems.
- The USA economy will continue to be a problem as it continues to borrow its way out of the financial crisis. The problem has been the economic boom that preceded this bust.
- The USA lived in a phony bubble by borrowing from other countries and imported goods from other countries.
- The free market is getting blamed for problems that were being created by government through not allowing the free market forces to act.