LOS ANGELES--(BUSINESS WIRE)--Offered in a new article authored by one of the world’s leading international financial authorities, Mr. Nechemia the Chairman of the Board of Directors of EurOrient Financial Group (“EurOrient”), policy makers, financial practitioners and investors will be both intrigued and enlightened about potential remedies for what began as a financial crisis in North America in August 2007 that has now developed into a global economic meltdown. Moreover, anyone interested in better understanding the Subprime Lending Crisis and how it evolved will be treated to an insightful historical account offered in Mr. Nechemia’s new article published in China’s leading Financial Publication.
In his article, Mr. Nechemia argues that the rapid innovation in asset securitization technology is the root cause of contemporary financial market development of the past three decades. Published by International Finance Magazine (“IFM”), Mr. Nechemia observes that, “the failures in today’s financial markets can be traced to the creation and Frankenstein-like mangling and market-butchering of the financial product known as Asset Securitization, or what the public at large has recently come to learn is Subprime Lending that triggered the global financial meltdown.”
In his recently published article, Asset Securitization: Revolution, Evolution, Devolution. The Rise and Fall of the Most Important Financial Instrument in Banking, Mr. Nechemia traces the success of Asset Securitization back to its introduction in the early 70s and how, “this financial instrument and the various permutations it morphed into during a more than 30-year period enabled the unprecedented growth of capital and financial markets in both the United States and abroad.”
Following the publication of two prior question- and-answer-style interviews, the first given by Mr. Nechemia for International Finance Magazine published in May 2008 in an article titled, Guard Against the Influence Brought by Subprime Landing Crisis,at which time Mr. Nechemia announced that he saw a systemic financial crisis brewing and warned that in the months to come the United States was likely to face a once-in-a-lifetime financial crisis, an oil shock, sharply declining consumer confidence and, ultimately, a deep recession. In that article he also foretold of homeowners defaulting on mortgages, trillions of dollars of mortgage-backed securities unraveling worldwide and the global financial system shuddering to a halt. The second interview, a Cover Story published in March 2009, “At the Epicenter: Where the Financial System Meets the Real Economy,” Mr. Nechemia offers observations and insightful commentary regarding the critical financial issues as it relates to the world’s global financial crisis, its impact on China, recommended reforms and action steps, along with forecasts of the Chinese economy in the year to come.
International Finance Magazine is China’s only financial publication supervised by the China Council for the Promotion of International Trade. Following the excellent reception and accuracy of his market commentary, the Magazine, which is devoted to national and international investment and financing markets, asked Mr. Nechemia to write a series of financial and investment-related articles. Says Mrs. Luyang Li, Editor-in-Chief, of International Finance Magazine. “Mr. Nechemia’s scholarly and accurate analysis in his prior interviews were so insightful, we asked him if he would write a series of articles that sheds light on the reasons that led to the current financial crisis in North America that has now developed into a global economic meltdown.”
“For this new article, Mr. Nechemia suggested he’d like to provide a thoughtful, technical paper for the crisis starting with a historical overview of Asset Securitization, the financial instrument, according to him that has been recognized by eminent academics as the most important engine of reform in our financial system.” Mr. Nechemia presents the case that Asset Securitization has emerged in recent times and is viewed as a revolution in the banking and financial services industry by industry practitioners.” says Mrs. Luyang Li. She adds, “we thought his concept for an article was not just timely, but fascinating and would be appreciated by our highly educated readers.”
In his 3,000 plus-words article, Mr. Nechemia argues that among other things, the “Asset Securitization product set new benchmark standards of innovation and productivity, credit enhancement and risk analysis, but in the end, left unchecked and to open market devices, is what he suggests, contributed greatly to the U.S. financial collapse and its tsunami like ripple effect throughout the world.”
The article goes on to discuss that many measures are required to repair what has become a badly damaged international financial system and proven dysfunctional financial architecture. Moreover, Mr. Nechemia provides thoughtful solutions to resolve some of the critical issues necessary to begin mending our credit systems that will foster healthy and productive financial systems, revitalizing and reenergizing productivity going forward. A potential remedy he offers can be replicated by adopting oversight and compliance practices currently utilized by the United States Food and Drug Administration, among other solutions as well.
According to Editor-in-chief of International Financial Magazine Mrs. Luyang Li, “readers will find this article, as others Mr. Nechemia has authored exclusively for our publication, interesting, fascinating, provocative and even useful to those who call investment banking their profession.”
In the article’s concluding paragraph, Mr. Nechemia suggests the following:
The introduction of Asset Securitization, and its evolution over three decades, has had a profound impact on consumers and financial institutions as an innovative product and no doubt, it will continue to remain so. In the light of recent events it is clear that more and better regulatory approaches must be instituted in order to ensure that the original model and some of its innovative iterations reconstitute to the original power and value they provided. In this manner, the markets will reset, consumers will benefit and Asset Securitization can regain its rightful perch as one of the most valuable products and financial instruments in banking history.
The International Finance Magazine features the country’s senior government officials, prominent business leaders and high-profile financiers in China, as well as the world. Since first being published in 2000, the Magazine has featured government and finance icons such as Mr. Chen Yuan, the President of National Development Bank; Mr. Samuel A. DiPiazza, Jr., CEO of PricewaterhouseCoopers; Mr. Dai Xianglong, Chairman of National Council for Social Security Fund; Mr. Haruhiko Kuroda, President of ADB; Mr. Li Lihui President of the Bank of China; Mr. Charles Li, Chairman and CEO of JPMorgan; Mr. Robert Greifeld CEO of NASDAQ; Mr. Paul Wolfowitz, President of World Bank; Mr. Francois Bourguignon The World Bank’s Chief Economist; Mr. Wang Lianzhou, The Economist, among scores of other prolific personalities within the Chinese as well as global financial community.
In an uncommon publishing move, in the same March issue, Mr. Nechemia was also profiled in a second article, “Mr. Ron Nechemia: A Devoted International Civil Servant.” Says Mrs. Luyang, “this full page piece offered insight into Mr. Nechemia, he has a unique and profound perspective we felt it was important to provide our readers and that they would appreciate.”
About Mr. Ron Nechemia
Mr. Ron Nechemia is an international political economist and a political risk analyst specializing in country/political risks in Asia, with particular expertise in China. Mr. Nechemia's unique wealth of knowledge has earned him many international awards and recognitions. He is frequently invited to consult and to advise in Special High-Level Policy Dialog to express its views and to share experiences on financing for development and on trade and investment related issues in front of the international community bilateral and multilateral organizations such as the Bretton Woods Institutions -- the World Bank and the International Monetary Fund (IMF), United Nations General Assembly, United Nations Economic and Social Council (ECOSOC) and the World Trade Organization (WTO). Mr. Nechemia is a member of the UNCTAD/ICC Investment Advisory Council and recognized as a foreign financial expert by the State Administration of Foreign Experts, the People's Republic Of China and he is frequently invited to advise and lecture on behalf of governments such as the United States of America, Republic of the Philippines, the People's Republic of China, South Korea, and the State of California Department of Energy just to name a few.
About EurOrient
EurOrient Financial Group is a private sector global development finance institution accredited financial institution by United Nations General Assembly on Financing for Development. The mission of the EurOrient Financial Group is to support the economic and social development efforts of the less developed countries as they, in particular, seek to achieve the Millennium Development Goals ("MDGs").
The EurOrient's principal objective is to reducing poverty and promoting sustainable economic growth. EurOrient invests in projects and programs that promote social development, build human capacities, and address host government priorities for investments in physical infrastructure that promote and enhance social development. These projects include roads, transportation and communication systems, water, sanitation and other types of investments with social development outcomes such as improved quality of life and increased human knowledge and skills.
About International Finance Magazine
Founded in 2000, International Financing Magazine is a Beijing–based magazine devoted to national and international investment industry in China. The magazine's driving mission is to increase knowledge of economic conditions in China, examine country and world-wide impact, and highlight key financial players in China and around the world; the publication is recognized as one of the most influential magazines in China. It is distributed to the largest government agencies and financial institutions in the country and is read by China’s business elite. The magazine has multiple affiliate website relationships that further drive its global readership and influence. Partnership with most periodical databank networks, such as: www.cnki.net;www.wanfangdata.com.cn; www.cqivp.com; www.sina.com; www.qg.com.cn; www.sinoprojects.com. Among them, all articles are readable on www.cnki.net; www.wanfangdata.com.cn; www.cqivp.com.
EurOrient at Glance
Headquarters: Los Angeles, California
Website: www.global-bank.org
CEO: Mr. Ron Nechemia
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