Financial Wisemen Endorse Increased Regulation

By on February 18, 2010

Several elderly thinkers in financial world including John Bogle, Paul Volcker, George Soros and William Donaldson believe increased financial regulation is necessary to prevent or mitigate crises in the future. This would include separation of banking and trading and also increased capital requirements.

SMA Comment: There is a very powerful lobby of Wall Streeters fighting added regulation arguing that it will impede “innovation.” Their main concern is the bonuses they count on to fund a lavish lifestyle might take a haircut if they aren’t allowed to take enormous risks. The insidious system of privatizing the gains and socializing the losses might become a thing of the past if capital requirements were boosted to sane levels.

Source: New York Times

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