This report discusses the growth of the private sector in China, which has occurred to a large extent from the government’s efforts to reform China’s money-losing state-owned enterprises (SOEs). Workers who have been laid off from SOEs have been encouraged to find jobs in the private sector or to start their own businesses.

This report sets out a framework for considering the issue of financial risk and its regulation. First, basic concepts and the state of the art in private risk management are discussed. Then, scenarios for financial crises that may require government intervention are explored. The next section deals with the development and the shortcomings of tools available to regulators to prevent or cope with crises. The report ends with an analysis of current trends in financial markets and their implications for risk oversight.

This report discusses the establishment of the “Corrections Day”, a concept credited to Michigan Governor John Englerwhich, which is a procedure for repealing “the dumbest things the federal government is currently doing and just abolish them.”