Governments and international financial institutions could consider providing bond guarantees to those municipalities.

Has this name been circulated to non banking financial institutions, i.e., pension, insurance and financial leasing companies, foreign exchange bureaus, securities firms and credit unions?

Banks and other financial institutions had doubts about the value of various asset backed securities on their own balance sheets and on those of potential counterparties. No one knew the real value of credit default swaps and of the various tranches of collateralized debt obligations.

Such tactics, in which banks are nudged, not coerced, into investing in government debt, constitute soft financial repression. But governments can go beyond such methods, demanding that financial institutions maintain or increase their holdings of government debt, as the UK s Financial Service Authority did in 2009.

50 MFIs have been visited and the most appropriate means of channelling investment to their institutions, i.e. bonds, asset backed securities, potential guarantors or insurance companies underwriting debt documents, etc., have been discussed

The application of funds of an insurance company is limited to bank deposits, trading of government and financial bonds and other forms of fund application stipulated by the State Council.

Article 50 A securities firm that carries out securities lending and borrowing business shall sign a securities lending and borrowing contract with the customer, and shall open a customer securities guarantee account with the securities registration and settlement organs, and a customer funds guarantee account with the designated commercial bank in the name of the securities firm in accordance with the provisions of the securities regulatory agency under the State Council.

But the risk sharing inherent to Islamic finance made such instruments more resistant to the first round of financial contagion that hit in 2008. Leading economists, such as Harvard University s Kenneth Rogoff, have suggested that Islamic finance demonstrates the advantages of more equity and risk sharing over the conventional bias in favor of debt instruments.

In order for the Organization to be in a position to make a bond offering to capital markets, Member States would have to agree to the establishment of certain financial mechanisms geared to assuring investors (i.e., the bond holders) of the return of their investment.

(13) As regards tradable financial liabilities, it is required to separately list the beginning of period and end of period fair value of offered tradable bonds, financial liabilities which are specified to be measured on fair value and whose fluctuations are included in the current profits and losses, derivative financial liabilities and other tradable financial liabilities.

Moreover, when providing their capital to a financial firm, bondholders can generally be expected to obtain contractual terms that reflect the risks they face. Indeed, the need to compensate bondholders for risks could provide market discipline when financial firms operate in ways that can be expected to produce increased risks down the road, they should expect to pay with, say, higher interest rates or tighter conditions.

Individuals, banks, and financial trade institutions should be legally responsible to make reports on the transfer of large amounts of cash and financial documents overseas.

An investment grade rating reflects the credit rating agencies' belief that the probability of payment of the bond is high and the financial risk associated with the investment is low.

Fostering the channelling of remittances through financial institutions ( bancarization').

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The most typical example is the case of debt management by the international financial institutions.

They have also accumulated large protracted arrears with the international financial institutions.

10. This has prevented the Sudan from dealing with the international financial institutions and consequently prevented it from paying its arrears to these institutions.

Modern finance has succeeded in creating a default dynamic of such stupefying complexity that it defies standard approaches to debt workouts. Securitization, structured finance, and other innovations have so interwoven the financial system s various players that it is essentially impossible to restructure one financial institution at a time.

9. FINANCIAL INSTITUTIONS

Article 56 Where a securities firm carries out securities lending and borrowing but does not have sufficient funds or securities, it can borrow from the securities financial companies.

62. The cost of the debt crisis to the Government will be high, and will include the guarantee given under the INDRA plan, as well as the cost of providing liquidity to the banking system and of financial sector restructuring and recapitalization of financial institutions.

The problem with short term debt is less severe for the non financial private sector as the bulk of such obligations were contracted by financial institutions.

Article 7 The securities regulatory agency under the State Council, the People's Bank of China and other financial regulatory authorities under the State Council should establish information sharing mechanism of supervision and administration over securities firms.

CDOs are a form of financial alchemy special purpose vehicles that buy the financial equivalent of lead (low rated mortgaged backed securities) and finance themselves mostly with the financial equivalent of gold (highly sought after AAA bonds). This transformation is based on one sound principle and two shaky ones.

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Since then, they have looked far less safe. And many observers within and outside the financial sector have begun to question the models upon which credit rating agencies, investment firms, and others rely to price the risks tied to such securities.

Article 41 A securities firm engaged in securities business for its own account is limited to trading of legally issued stocks, bonds, warrants, securities investment funds or other securities recognized by the securities regulatory agency under the State Council.

Governments should not only avoid protecting bondholders after the fact, when the details of a bailout are worked out but should also make their commitment to this approach clear in advance. Some of the benefits of a government policy that induces bondholders to insist on stricter terms when financial firms take larger risks would not be fully realized if bondholders believed that the government might protect their interests in the event of a bailout.

(5) Where an asset management agency and a securities registration and clearing agency does not report to the securities regulatory agency of the State Council when it finds trust funds and assets and securities in secured accounts of clients are used in violation of provisions.

So that brings the idea of some kind of rating agency, Morningstar type.

And yet MFIs have traditionally experienced high repayment rates (95 to 98 percent) and they work in a high growth sector.

(3) Where a securities firm, an asset management agency, a securities registration and clearing agency use trading settlement funds, trust funds and funds and securities in secured accounts of clients in violation of provisions