RBI Governor on issues raised by sub-prime crisis

RBI governor D Subba Rao flagged five important issues arising from the sub-prime crisis in a speech at a seminar in Hyderabad earlier this month:

1. How do we manage global imbalances?

2. Is self-insurance a viable policy option for emerging economies?

3. What are the flaws of the current regulatory regimes? How do we fix them? In what ways can international cooperation be fostered in this regard? How do we address the black swan systemic risk events?

4. How do we address the problem of regulatory arbitrage?

5. How do we keep the financial sector in line with the real sector?