Transparency Network for Dispersed Persistent Examination of Financial Institutions (discussion)
Discussion Forum, Hyper-convergence paradigm, Quipu Economic Forum :: Comments (0)
9 June 2009 :: by J.E. Robertson
The underlying problem in the financial system —which allowed banking institutions to hide bad debt in bundled assets, and resell it to trading partners who may not have been given full disclosure on the unsustainable nature of much of the underlying debt— is transparency. A fierce individualist ideology led to a convenient clouding over of the reporting mechanisms intended to make financial institutions more ethical, more stable, and more useful to those outside their walls.
One of the major innovations that could take place —either by collaborative effort now in a time of crisis, or over time, as everyday operators within markets work to adopt the most intelligent organizational tools— would be a vast network of open information, regarding the management of investment funds, securitized loan holdings, and lending practices at a given institution.
This system need not reveal any personal private information about individual investors or bank customers, but would be made available to the public so that the maximum possible amount of information be searchable for anyone wishing to vet the claims of in-house analysts. Part of the goal would be to facilitate the proliferation of new smart-reporting economic databases, and to allow competing points of view on the most complex investment-backup schemes to have an open hearing, as based on credible information.
What mechanisms would do best for ensuring that an open network of institutional transparency could provide stability and sustainability in high-end financial risk-taking?
