One of the best ways to kill the vibe at any party is to bring up financial market regulation. Few people want to discuss the theory behind it, much less the details of our regulatory framework, and who can blame them? On the other hand, most policymakers inside the beltway view this regulatory framework as sacred. They're happy to talk about it, but only if you want to expand it. I'm positive, though, that only a select few members of Congress know many of the details. And if the rest did spend the time to dig in, they would recognize three things: There was no substantive deregulation of financial markets in the last century; regulating to safeguard financial stability was not invented after the 2008 financial crisis; and much of the theory behind the post-2008 regime is little more than wishful thinking.
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