The Right Approach to Regulation

Paul Singer, a member of the board of COMMENTARY Inc. and founder and chief executive officer of Elliott Management Corp., has an important piece today in the Wall Street Journal about the need for a new global regulatory system to prevent the taking of apocalyptic risk:

Creating a regulatory system that reflects the modern-day realities of financial markets is not as difficult as it may appear. The financial structures that destabilized our markets have definable characteristics….It is critical that any new regulatory initiative have a global mandate and contain mechanisms to prevent “risk infection” by countries that try to dodge risk controls. There are legitimate concerns about the time needed to devise a global risk-management system and staff it with individuals with the requisite sophistication and experience. But there are relatively simple solutions.

Read the whole thing.