Spot on

Chinese Premier Wen Jiabao at the World Economic Forum is worth listening to. At the beginning of his speech, after proper welcoming and greeting the Chinese New Year of the Ox, Premier Jiabao outlined his understanding of the "variety of factors" contributing to the world's financial crisis. These factors include:

1. inappropriate macroeconomic policy;
2. unsustainable model of development characterized by prolonged low savings and high consumption;
3. excessive expansion of financial institutions in blind pursuit of profit;
4. lack of self discipline among financial institutions and rating agencies;
5. ensuing distortion of risk information and asset pricing; and
   
6. failure of supervision and regulation to keep up with financial innovation which allowed risk of derivatives to build and spread.
   

I particularly like #3. If only our own politicians and economic experts could be so lucid.