##er to a u. s. view on the appropriate global standard. you can see some of these dynamics in the financial arena, and concern about the erosion in the relative position of the u. s. financial system. financial markets outside the united states are now deeper and more liquid than they used to be, making it easier for companies to raise capital domestically at reasonable cost. these financial markets are at an earlier stage in the process of capital market development, and they will therefore experience rapid growth in securitization and the role of derivatives. these factors, more than other differences in tax, accounting, or legal regulatory regimes, account for the bulk of the declines'share of equity and debt raised in the united states by companies around the world. and this shift is something that we benefit from, not just in the direct sense that u. s. financial institutions play an important role in those markets, but in the broader sense that we will gain from the improvements in economic growth that come from financial market development around the world. but in this context, we need to be more attentive to the risk that specific aspects of our system, regulations or other constraints, create a greater disincentive to locate a financial business here, or to invest here, or to raise capital here, than would have been the case five or ten years ago. we need to take a careful look at how we regulate financial activity in a world where capital is more mobile, and the structure of the financial system has diverged substantially from the system for which our regulatory framework was designed. that does not mean we should contemplate weaker regulation or lower standards. the strength of the u. s. system is in part the result of the confidence we have developed in the integrity and resilience of our markets, in part by establishing strong standards for investor protection, market practices, and safety and soundness. sustaining this confidence will be critical to the future strength of our financial system. to complete this list of policy challenges that are important to u. s. competitiveness, let me conclude with a few brief points on the broader imperatives of macroeconomic policy. the united states faces very substantial gaps between our fiscal resources and our expenditure commitments. the size of these gaps, these deficits, have been masked in recent years by a substantial, unanticipated and probably transitory surge in revenues, and by an unusually long period of unusually low long - term interest rates, in part the consequence of

foreign official capital flows. but these gaps remain substantial and the u. s. fiscal position is unsustainable. time does not help. we are going to have to begin to develop a political consensus on the mix of policy changes that can bring our commitment and resources more into balance, if we are to preserve confidence in our market and our long - term economic prospects. one of the most important roles for public policy is the maintenance of a stable macroeconomic framework that enables firms to make long - term investment decisions. in this sense, the fiscal policy choices ahead for this country will be critically important to the overall environment in which u. s. enterprises operate. the business community will play an important role in shaping the policy response to these longer - term economic challenges. these reforms will have a long fuse. the benefits will be shared broadly, rather than captured specifically by particular sectors of the economy. american companies have a strong collective interest in sustaining public support for global integration, improving the quality of public goods the government provides in education, health care and infrastructure, and in preserving confidence in u. s. fiscal sustainability. thank you.