The financing must come--but from where?

This article discusses important challenges faced in the 1980s by Western financial markets. These include financing increased domestic capital development as well as financing imbalances of international surpluses and deficits, and to do both in the midst of inflation. The ability of banking systems and securities markets to meet the needs of borrowers in the 1980s is questioned. It is ultimately determined that if financial markets are unable to accomplish the financing challenges before them, Western economies will either have to forfeit their goals for renewed growth in living standards or come to terms with increased instability in their international financial arrangements. The author asserts that financial markets must research innovations that have the potential to prevent such scenarios.