Uncategorized
A Regulatory Lesson for the Future
|
This week the world’s most powerful leaders meet in Davos, Switzerland for the World Economic Forum. As an indication of the changing times, this year’s summit will be attended by 40 heads of state, as compared to only 27 last year. More regulation lies ahead and undoubtedly there needs to be a balance between purposeful, tough regulation and free-market oriented solutions. However, more should not be a synonym for effective when it comes to regulation. This can only be achieved if the financial institutions that have fallen victim to the current crisis are willing to assist regulators and come to terms with the notion that there may be a change in regulatory arbitrage and the world financial system as a whole.