The failure of regulation

No-one is willing to admit that more regulation is not the answer. We have plenty of regulation, of varying quality. But what is clear to the few who are prepared to look is that the authorities made exactly the same mistakes as the banks in this crash. They under-estimated the risks of securitisation and thought that securitisation reduced risk, nor is it likely that regulators will learn more quickly than the markets in the future. Despite this, regulators will be rewarded for this failure by having their empires made bigger and more powerful. No wonder “regulator failure” is so common.