Highlights and lowlights 2011

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Highlights and lowlights 2011

Euromoney Skew takes a quick look at the highlights and lowlights that have shaped the world in 2011


Dear readers

2011 has been a remarkable year and even more tumultous than the last.


While each year has seemingly become more packed with ground-breaking news and events from around the globe, 2011 has also marked the launch of Euromoney Skew.


From the earthquake in Japan  to the death of North Korea's dictator Kim Jong-il, to the alleged rogue-trading scandal  that rocked UBS to the unfolding sovereign-debt crisis, 2011 will not be forgotten.


Protests and riots sparked by political and financial unrest around the globe also marked a huge change for society. In the US, the Occupy Wall Street  movement caused a contagious spread of similar protests from London to Australia, while the Middle East saw one of the biggest shifts in societal and political power in the past 20 years.


Since the Lehman Brothers debacle in 2008, regulators and market participants have worked hard to try to prevent another systemic collapse, but 2011 echoed much of the chaos and crises of years gone by.


While 2009 was said to be the turning point and 2010 as the road to recovery, much of 2011 was marred with the eurozone sovereign-debt crisis and the explosive aftermath.


MF Global in October  became the largest Wall Street firm to file for bankruptcy  since the demise of Lehman Brothers. Struggling to overcome the burden of sovereign debt it had on its books, it folded - and with it, the search for much of the clients' money has become a circus.


Banks throughout the eurozone have subsequently been scrambling to pare down exposure to sovereign debt.


Ratings agencies have also had a busy year, where previously the unthinkable act of downgrading AAA-status  eurozone countries and banks has become a reality. Even France is on the brink of losing its gold-plated credit rating.


Other previously unthinkable events have unfolded, including banks and financial firms actively testing their systems for a break-up of the euro, which is not a positive sign.


The ECB's ability to bailout and fund financial institutions has also reached crisis point, as it would not be able to pass the European Banking Authority's set of stress tests.


Meanwhile, an EU treaty still has to be clarified and possibly reworked, as the UK  vetoed the Merkozy fiscal union, and legal experts highlighted the loopholes and "legal denial" over implementation.


If the eurozone sovereign-debt crisis wasn't enough, UBS signalled the lack of lessons learnt from previous years, after an alleged rogue trader caused a $2.3 billion loss for the investment bank. Risk-management practices have been called into question, and dismay from market participants has swept the markets on the notion that financial institutions have not improved such strategies.


Asia, of course, has been the beacon for growth for many financial firms, especially with the continual liberalisation of China's renminbi, creating a more open market for foreign investors. However, while Asia has been growing faster than the West, it is heading for a slowdown, and some fundamental figures illustrate that the region is still as fallible as the rest of the world.


But it's not all doom and gloom. A glimmer of hope comes in the form of  research obtained by Euromoney, which shows how doomsday prophecies for 2012 are wrong


2011 has shaped the future of financial markets, political landscapes and regulation, and it is therefore impossible to quantify all of this here.


So check out the website, or the current issue and back issues of Euromoney magazine, to see all the news, analysis, and exclusive and key interviews the team has delivered over the year.


The Euromoney team will be taking a well-earned break for the holidays, and will be returning on January 3. So, all that's left to say, from everyone here at Euromoney, have a very merry Christmas and a happy New Year – and to all new readers of Euromoney Skew, thank you.


Regards


Lianna Brinded

Editor


Euromoney.com and Euromoney Skew

 

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