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Inadequate capital certainly explained why many, if not all, financial institutions foundered in 2007 and 2008.
Mr. Soros said the problem with the looming crisis was inadequate capital flows from industrial nations to emerging nations.
And even if the vicious circle is limited, the financial system will still be crippled by inadequate capital.
This, he said, raised the risk of inadequate capital "not only for the banks but for private sector debtors as well".
The electronic control of electricity, he said, is "an example of the ways that system operators have tried to get around inadequate capital infrastructure".
Part of the problem was that many bond insurers, including A.I.G., sold credit-default swaps as a form of insurance with inadequate capital to cover their obligations.
Similar(27)
The natural thing to do, then — and the solution adopted in many previous financial crises — is to deal with the problem of inadequate financial capital by having governments provide financial institutions with more capital in return for a share of ownership.
The NASD fined Bank One's Banc One Capital Markets unit for inadequate net capital, insufficient customer reserves and inaccurate records.
"NSR came out of Infosys strongly believing that the entrepreneurial opportunities in India were being limited because of inadequate angel capital," says Venkatachalam of Connexios.
firm's cheeky statement didn't include its recent regulatory record: inadequate net capital and unauthorized trading, and pending Utah allegations that an unlicensed broker used "boiler-room sales tactics".
Financial constraints such as inadequate investment capital, insufficient loan, and inefficient financial market are the major obstacles in doing business, and most MSE's are highly risky ventures involving excessive administrative costs and lack of experience in dealing with financial institutions (Commission on Legal Empowerment of the Poor (CLEP) 2006).
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