Finance and Accounting - Essay Example

After assessing things like stock market capitalization, employment, profits, contribution to Gross Domestic Product and the likes, it is clear that the financial system expanded by a big margin since 1990. For instance, by 1989 the global financial assets were about 50 trillion but increased to about 200 trillion by the end of 2007 (Anderloni, 2009:23). Generally, analysts describe financial system innovation as the key to ending the financial crisis and woes that are facing the world’s economy. This is because; assessments carried out to establish how the system has been working reveal that it is through innovation of new financial tools that can put to an end the world’s common complex financial crisis. As illustrated by progress of financial innovations, the way people handled financial matters twenty years ago is different today. Advancements and innovations regarding financial technology transformed apparently due to need for better financial management brought about by time and technology. Globally, people are able to face and overcome challenges regarding finances as a result of financial innovative systems. However, before regulators start making decisions on how to regulate, if they should, activities of financial institutions, it is vital that they consider the consequences of their actions. ...