Exit the main stream ! Options to restore financial markets at the end of the neoliberal disaster Author - Affiliation: Rainer Stachuletz - Professor of Finance and Investments at the Berlin School of Economics and Law. He is currently acting as consultant for the State Bank of Vietnam at the Banking Academy of Vietnam in Hanoi. He is Academic Director of the study programmes of the Berlin School of Economics and Law in Vietnam at the Banking Academy of Vietnam (Hanoi) and the Ho Chi Minh City Open University (HCMC) Hansjörg Herr - Professor of Supranational Integration at the Berlin School of Economics and Law. He is also the Academic Director of the Master’s programme Labour Policies and Globalisation of the Global Labour University and a German-Chinese Double Degree Master Corresponding author: Hansjörg Herr - kim.npt@ou.edu.vn DOI:10.46223/HCMCOUJS.econ.en.2.1.69.2012

Abstract

In the context of the currently ongoing financial crisis some research work has been done to outline the major weaknesses of the deregulated and liberalized financial system architecture. A growing shadow-financial system, the abuse of investment techniques and the available financial instruments, accompanied by poorly performing and overestimated rating agencies, short term oriented financial behaviour and a poorly developed regulatory and supervisory environment led to a two-digit trillion Dollar damage. The system has in parts lost its function to efficiently intermediate between savers and borrowers and thus became a continuous threat to the value creating real economy. To restore the functionality of the financial system a set of measures is discussed. The Vietnamese financial system partially mirrors weaknesses of the current global financial system, although its particular strengths and weaknesses have to be considered separately as they are borne by the specific features of the Vietnamese economic system.