“Instead of exhausting ourselves drawing up hopelessly complex codes of ‘macro-prudential’ or ‘counter-cyclical’ regulation, let us go back to Bagehot’s world, where individual prudence – rather than mere compliance was the advisable course, precisely because the authorities were powerful and the crucial rules unwritten.I began this chapter by contradicting the proponents of stricter regulation, only to end it by advocating the exemplary incarceration of bad bankers. I hope it is now clear why these positions are not contradictory but complementary. A complex financial world will be made less fragile only by simplicity of regulation and strength of enforcement.”
Excerpt From: Ferguson, Niall. “The Great Degeneration.” Penguin Group, USA, 2013-05-15. iBooks.
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